§ 36C-10-1010. Limitation on personal liability of trustee. - North Carolina Statutes

§ 36C‑10‑1010. Limitation on personal liability of trustee.

(a)        Except as otherwiseprovided in the contract, a trustee is not personally liable on a contractproperly entered into in the trustee's fiduciary capacity in the course ofadministering the trust if the trustee in making the contract disclosed thefiduciary capacity. The addition of the phrase "trustee" or "astrustee" or a similar designation to the signature of a trustee on awritten contract is considered prima facie evidence of a disclosure offiduciary capacity.

(b)        A trustee ispersonally liable for torts committed in the course of administering a trust,or for obligations arising from ownership or control of trust property,including liability for violation of environmental law, only if the trustee ispersonally at fault.

(c)        A claim based on acontract entered into by a trustee in the trustee's fiduciary capacity, on anobligation arising from ownership or control of trust property, or on a tortcommitted in the course of administering a trust, may be asserted in a judicialproceeding against the trustee in the trustee's fiduciary capacity, whether ornot the trustee is personally liable for the claim. Any judgment rendered infavor of a claimant in such a judicial proceeding against a trust may berecovered from the trust property without proof that the trustee could haveobtained reimbursement from the trust if the trustee had paid the claim.

(d)        A trustee isentitled to indemnity from the trust for any claim, other than a breach oftrust, for which the trustee is liable:

(1)        If the claim arosefrom a common incident of activity in which the trustee was properly engagedfor the trust;

(2)        If the trustee wasnot personally at fault; or

(3)        To the extent thatthe trustee's actions increased the value of trust property.

(e)        A decision by atrustee not to inspect property, or to decline to accept property, shall notcreate any inference as to liability, under any environmental law, with respectto that property. A trustee shall have no liability for a decrease in value ofproperty in a trust by reason of the trustee's compliance with anyenvironmental law, including reporting requirements. (2005‑192, s. 2.)