Kòd Trust Arizona la, seksyon pa seksyon

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Verifye ak Arizona Statutes yo nan dat 2026-10-12. Enfòmasyon jeneral, pa konsèy legal; tèks ofisyèl la ki kòmande.

Article 1: General provisions and definitions

A.R.S. § 14-10101 ↗ Short title: Names the chapter: it may be cited as the Arizona Trust Code.
A.R.S. § 14-10103 ↗ Definitions: Defines the Arizona Trust Code's terms — among them a "qualified beneficiary", a beneficiary who on the date of determination is a distributee or permissible distributee of trust income or principal, or would be one if the current distributees' interests or the trust itself ended that day; a "distributee", a person who receives property from a trust other than as a creditor or purchaser; "revocable", revocable by a settlor without anyone's consent; a "settlor", each person who creates or contributes property to a trust; the "terms of a trust"; a "trust instrument"; a "special needs trust"; and a "trustee", which includes an original, additional and successor trustee and a cotrustee.
A.R.S. § 14-10105 ↗ Default and mandatory rules: The terms of a trust prevail over the chapter except the rules the section lists: the requirements for creating a trust; the trustee's duty to act in good faith and in accordance with the trust's purposes; a lawful purpose for the beneficiaries' benefit; the court's powers to modify or terminate a trust, to require or dispense with a bond and to adjust specified compensation; the effect of a spendthrift provision and certain creditors' rights; the duty to respond to a qualified beneficiary's request for reports and other information on an irrevocable trust; the effect of an exculpatory term; third parties' rights; periods of limitation; the court's jurisdiction and venue; the charitable notices of section 14-10110; and the penalty-clause rule.
A.R.S. § 14-10107 ↗ Governing law: The meaning and effect of a trust's terms are determined by the law of the jurisdiction the trust instrument designates; absent a controlling designation, the law of the place where the trust was executed determines its validity, and the laws of descent and the law of the principal place of administration determine its administration.
A.R.S. § 14-10108 ↗ Principal place of administration: A designation of the principal place of administration controls where a trustee's principal place of business or residence is there or part of the administration occurs there; a trustee is under a continuing duty to administer the trust at a place appropriate to its purposes and the beneficiaries' interests, may transfer the principal place of administration to another state or country after notifying the qualified beneficiaries at least sixty days before the transfer — the notice naming the new jurisdiction, the new address and telephone number, the reasons, the anticipated date and an objection date at least sixty days after the notice — and loses that authority if a qualified beneficiary sends a reasonably founded written objection by the date named.
A.R.S. § 14-10109 ↗ Methods and waiver of notice: Notice under the chapter, or a document it requires to be sent, must be accomplished in a manner reasonably suitable under the circumstances and likely to result in receipt — first class mail, personal delivery, delivery to the person's last known place of residence or business, or a properly directed electronic message; it need not go to a person whose identity or location is unknown to and not reasonably ascertainable by the trustee; the person to be notified may waive it; and notice of a judicial proceeding follows section 14-1401.
A.R.S. § 14-10110 ↗ Others treated as qualified beneficiaries: A charitable organization expressly and irrevocably designated to receive distributions under a charitable trust, and a person appointed to enforce an animal or purpose trust, have a qualified beneficiary's rights; for a charitable trust created on or after January 1, 2009 and administered in Arizona, the trustee furnishes the attorney general the portions of the instrument that describe the charitable purpose within sixty days of the trust's creation, notifies the attorney general of an acceptance within sixty days, and gives at least thirty days' advance notice of a change of the principal place of administration to another state, a dissolution, a change of the charitable purpose, court proceedings or a change in the method or rate of the trustee's compensation.
A.R.S. § 14-10111 ↗ Nonjudicial settlement agreements; definition: Interested persons may enter into a binding nonjudicial settlement agreement on any matter involving a trust — the interpretation of its terms, the approval of a trustee's report or accounting, a direction to a trustee, the resignation, appointment or compensation of a trustee, a transfer of the principal place of administration or a trustee's liability — valid to the extent it does not violate a material purpose of the trust and contains terms the court could properly approve; any interested person may ask the court to approve it, and the court may approve or decline to approve the agreement but may not disapprove it.
A.R.S. § 14-10113 ↗ Penalty clause for contest; restriction: A trust provision that purports to penalize an interested person for contesting the trust instrument or instituting other proceedings or actions relating to the trust property is unenforceable if probable cause exists for the contest, proceeding or action.

Article 2: Judicial proceedings

A.R.S. § 14-10201 ↗ Role of court in administration of trust: The court may intervene in the administration of a trust to the extent its jurisdiction is invoked by an interested person or as provided by law; a trust is not subject to continuing judicial supervision unless the court orders it; a judicial proceeding may relate to any matter involving the trust's administration, including a request for instructions and an action to declare rights.
A.R.S. § 14-10204 ↗ Venue: Venue for a judicial proceeding involving a trust is the county of the trust's principal place of administration and, for a trust created by will while the estate is open, the county where the estate is administered; where a trust has no trustee, a proceeding to appoint one may be brought where a beneficiary resides, where trust property is located or, for a testamentary trust, where the estate was or is being administered.
A.R.S. § 14-10205 ↗ Alternative dispute resolution: A trust instrument may provide mandatory, exclusive and reasonable procedures to resolve issues between the trustee and interested persons, or among interested persons, with regard to the administration or distribution of the trust.

Article 3: Representation

A.R.S. § 14-10301 ↗ Representation: The probate code's representation rules — sections 14-1404 through 14-1408 — apply to trusts governed by the chapter.
A.R.S. § 14-10302 ↗ Appointment of representative: Where a beneficiary's interest is not represented, or the available representation might be inadequate, the court may appoint a representative to receive notice, give consent and otherwise act for a minor, an incapacitated person, an unborn child or a person whose identity or location is unknown — for one or several persons or interests, whether or not a proceeding is pending; a representative may consider the general benefit to the living members of the represented person's family.

Article 4: Creation, validity, modification and termination of trust

A.R.S. § 14-10401 ↗ Methods of creating trust: A trust may be created by a transfer of property to a trustee during the settlor's lifetime or by will or another disposition taking effect at the settlor's death, by an owner's declaration that the owner holds identifiable property as trustee, or by the exercise of a power of appointment in favor of a trustee.
A.R.S. § 14-10402 ↗ Requirements for creation: A trust is created only if the settlor has capacity and indicates an intention to create it, the trust has a definite beneficiary or is a charitable, animal or noncharitable-purpose trust, the trustee has duties to perform, and the same person is not the sole trustee and sole beneficiary; a beneficiary is definite if ascertainable now or in the future, and a power to select a beneficiary from an indefinite class is valid but fails if not exercised within a reasonable time.
A.R.S. § 14-10407 ↗ Evidence of oral trust: A trust need not be evidenced by a trust instrument unless another statute requires one, but an oral trust's creation is established only by clear and convincing evidence and its terms by a preponderance of the evidence; a trust created by a written instrument may be amended or revoked only by a written instrument the settlor executes.
A.R.S. § 14-10410 ↗ Modification or termination of trust; proceedings for approval or disapproval: Beyond the methods of sections 14-10411 through 14-10414, a trust terminates to the extent it is revoked or expires under its terms, no purpose remains to be achieved, or its purposes have become unlawful, contrary to public policy or impossible to achieve; a trustee or beneficiary may commence a proceeding to approve or disapprove a proposed modification, termination, combination or division.
A.R.S. § 14-10411 ↗ Modification or termination of noncharitable irrevocable trust by consent: A noncharitable irrevocable trust may be terminated on the consent of all beneficiaries if the court concludes its continuance is not necessary to achieve any material purpose, or modified if the modification is not inconsistent with a material purpose; on termination the trustee distributes as the beneficiaries agree; where not all beneficiaries consent, the court may approve the change if the trust could have been modified or terminated with everyone's consent and a nonconsenting beneficiary's interests will be adequately protected.
A.R.S. § 14-10412 ↗ Modification or termination because of unanticipated circumstances or inability to administer trust effectively: The court may modify a trust's administrative or dispositive terms, or terminate it, where circumstances the settlor did not anticipate mean doing so will further the trust's purposes — in accordance with the settlor's probable intention — and may modify administrative terms whose continuation would be impracticable, wasteful or an impairment of the administration; on termination the trustee distributes consistently with the trust's purposes.
A.R.S. § 14-10414 ↗ Modification or termination of uneconomic trust: After notice to the qualified beneficiaries, the trustee of a trust whose property is worth less than one hundred thousand dollars in total, or which is uneconomic to administer, may terminate it on concluding that the value is insufficient to justify the cost of administration — a power an interested trustee as defined in section 14-11014 does not have; the court may modify or terminate such a trust or replace the trustee; on termination the trustee distributes consistently with the trust's purposes; a conservation or preservation easement is excluded.
A.R.S. § 14-10417 ↗ Combination and division of trusts: After notice to the qualified beneficiaries — unless the trust instrument provides that notice is not required — a trustee may combine two or more trusts into one or divide a trust into separate trusts, if the result does not impair any beneficiary's rights or adversely affect the achievement of the trust's purposes.

Article 5: Creditor's claims; spendthrift and discretionary trusts

A.R.S. § 14-10501 ↗ Rights of beneficiary's creditor or assignee; exception: The court may authorize a creditor or assignee of a beneficiary to reach the beneficiary's interest by attaching present or future distributions or by other means, limiting the relief as the circumstances warrant; the section does not apply, and the trustee has no liability to a beneficiary's creditor for distributions, to the extent the interest is protected by a spendthrift provision or is a discretionary interest under section 14-10504.
A.R.S. § 14-10502 ↗ Spendthrift provision: A spendthrift provision is valid only if it restrains either voluntary or involuntary transfer of a beneficiary's interest; a term that the interest is held subject to a spendthrift trust, or words of similar import, suffices to restrain both; a beneficiary may not transfer an interest in violation of a valid provision, and except as the article provides a creditor or assignee may not reach the interest, or a distribution, before the beneficiary receives it.
A.R.S. § 14-10503 ↗ Exceptions to spendthrift provision; definition: Even against a spendthrift provision, a beneficiary's child who holds a judgment or order for support, or a judgment creditor who provided services protecting the beneficiary's interest in the trust, may obtain an order attaching present or future distributions for those matters only; the exception is unenforceable against a special needs trust; a spendthrift provision is unenforceable against a claim of the state or the United States only to the extent a statute so provides.
A.R.S. § 14-10504 ↗ Discretionary trusts; effect of standard; definition: Whether or not a trust has a spendthrift provision, a creditor of a beneficiary may not compel a distribution that is subject to the trustee's discretion, even where the discretion is expressed as a standard or the trustee has not complied with it — except that a court may order a distribution to satisfy a judgment for the support of the beneficiary's child, limited to what the trustee would have been required to distribute; the beneficiary's own right to sue for an abuse of discretion remains; insurance proceeds and values exempt in a beneficiary's hands keep their exemption when payable to a trust for that beneficiary; and a beneficiary-trustee's interest cannot be reached where the discretion is purely discretionary or limited by an ascertainable standard.
A.R.S. § 14-10505 ↗ Creditor's claim against settlor: During the settlor's lifetime a revocable trust's property is subject to the settlor's creditors; a creditor of the settlor of an irrevocable trust may reach the maximum that can be distributed to or for the settlor, with limits for tax-reimbursement powers and special needs trusts; after the settlor's death, the property of a trust that was revocable at the death is subject to the settlor's creditors' claims, the costs of administering the settlor's estate, the funeral expenses and the statutory allowances to a surviving spouse and children to the extent the probate estate is inadequate — subject to the settlor's right to direct the source of payment and to exemptions, with each settlor's contribution and the community-property laws preserved; the holder of a power of withdrawal is treated as a settlor while the power may be exercised; and contributions by an entity, and to the marital and spousal trusts the section lists, are not treated as the settlor's.
A.R.S. § 14-10506 ↗ Overdue distribution; definition: Whether or not a trust has a spendthrift provision, a creditor or assignee of a beneficiary may reach a mandatory distribution of income or principal — one the terms require, including a distribution at a stated age, on the exercise of a power of withdrawal or on termination — that the trustee has not made within a reasonable period after the mandated date, unless the terms expressly authorize the trustee to delay it to protect the beneficiary's interest; a distribution subject to the trustee's discretion is not mandatory even where the discretion is expressed as a standard or coupled with language of direction.
A.R.S. § 14-10507 ↗ Personal obligations of trustee: Trust property is not subject to the personal obligations of the trustee, even if the trustee becomes insolvent or bankrupt.

Article 6: Revocable trusts

A.R.S. § 14-10602 ↗ Revocation or amendment of revocable trust: Unless the terms expressly provide that the trust is irrevocable, the settlor may revoke or amend it subject to the terms' limits; where more than one settlor created or funded it, the community-property portion may be revoked by either spouse as to that spouse's share but amended only by both spouses jointly, and each settlor may revoke or amend the portion attributable to that settlor's other contributions; revocation or amendment is by substantial compliance with the terms' method or, where none is exclusive, by a later will or codicil that expressly refers to the trust or specifically devises its property, or by another signed writing manifesting clear and convincing evidence of the settlor's intent; an agent or a conservator may exercise the settlor's powers only as the section allows; and a trustee without actual knowledge of a revocation or amendment is not liable for acting as if none had occurred.
A.R.S. § 14-10603 ↗ Settlor's powers; powers of withdrawal: While a trust is revocable by the settlor, the rights of the beneficiaries are subject to the settlor's control and the duties of the trustee are owed exclusively to the settlor; the holder of a power of withdrawal has a settlor's rights to the extent of the property subject to the power while it may be exercised.
A.R.S. § 14-10604 ↗ Limitation on actions contesting validity or revocable trust; distribution of trust property: A proceeding to contest the validity of a trust that was revocable at the settlor's death must be commenced within the earlier of one year after the death and four months after the trustee sent the person a copy of the trust instrument and a notice of the trust's existence, the trustee's name and address and the time allowed for commencing a proceeding; after the death the trustee may proceed to distribute the trust property under the terms and is not liable for doing so unless the trustee has actual knowledge of a pending contest or a potential contestant has notified the trustee in writing of a possible proceeding and commences one within sixty days after sending the notification; a beneficiary of a trust later determined invalid must return a distribution unless a bona fide purchaser for value without notice.

Article 7: Office of trustee

A.R.S. § 14-10701 ↗ Accepting or declining trusteeship: A person designated as trustee accepts by substantially complying with the terms' method of acceptance or, where none is exclusive, by accepting delivery of the trust property, exercising powers or performing duties as trustee, or otherwise indicating acceptance; a designated trustee who has not accepted may reject, and one who does not accept within a reasonable time after knowing of the designation is deemed to have rejected; without accepting, a designated person may act to preserve the trust property if a rejection is sent within a reasonable time afterward, and may inspect or investigate the property for environmental or other liability.
A.R.S. § 14-10702 ↗ Trustee's bond: A trustee gives bond only if the court finds one needed to protect the beneficiaries or the terms require it and the court has not dispensed with it; the court sets the amount, the liabilities and whether sureties are necessary and may modify or terminate the bond; a national banking association, a state bank, a savings and loan association authorized for trust business, a qualified title insurance company, a certificated trust company and the public fiduciary give no bond whatever the terms say.
A.R.S. § 14-10703 ↗ Cotrustees: Cotrustees who cannot reach a unanimous decision may act by majority; the remaining cotrustees may act when a vacancy occurs; each cotrustee must participate unless unavailable or the function is properly delegated; when a cotrustee is unavailable and prompt action is necessary, the remaining cotrustee or a majority of them may act; a trustee may delegate a function to a cotrustee unless the terms require joint performance, and may revoke a revocable delegation; a trustee who does not join in another's action is not liable for it, but each trustee must exercise reasonable care to prevent a cotrustee's material breach and to compel its redress; a dissenting trustee who joined at the majority's direction after noting the dissent is not liable unless the action is a material breach.
A.R.S. § 14-10704 ↗ Vacancy in trusteeship; appointment of successor: A vacancy in a trusteeship occurs on a designated trustee's rejection, nonexistence or unidentifiability, a trustee's resignation, disqualification, removal or death, or the appointment of a guardian or conservator for an individual trustee; it need not be filled while a cotrustee remains, and must be filled when no trustee remains — for a noncharitable trust by the person the terms designate or a person appointed under a power the instrument confers, then by a person the qualified beneficiaries unanimously agree on, then by the court; for a charitable trust by the designated successor, then a person the designated charitable organizations select, then the court; the court may also appoint an additional trustee or special fiduciary whenever necessary.
A.R.S. § 14-10705 ↗ Resignation of trustee: A trustee may resign, unless the instrument provides otherwise, on at least thirty days' notice to the qualified beneficiaries, the settlor if living and all cotrustees, or with the court's approval; the court may impose conditions to protect the trust property; a resignation does not discharge the resigning trustee's or the sureties' liability for the trustee's acts or omissions.
A.R.S. § 14-10706 ↗ Removal of trustee: The settlor, a cotrustee or a beneficiary may ask the court to remove a trustee, or the court may act on its own; grounds are a material breach of trust, a lack of cooperation among cotrustees that substantially impairs the administration, unfitness, unwillingness or persistent failure to administer the trust for the beneficiaries, or a substantial change of circumstances or a request by all qualified beneficiaries where removal best serves the beneficiaries, is not inconsistent with a material purpose and a suitable successor is available; the court may order protective relief meanwhile; and on the petition of a beneficiary who is also a settlor, the court substitutes a trustee and appoints a successor where that is in the beneficiary's best interest.
A.R.S. § 14-10707 ↗ Delivery of property by former trustee: Until the trust property is delivered to a successor trustee or another person entitled to it, a trustee who has resigned or been removed keeps a trustee's duties and the powers necessary to protect the property — unless a cotrustee remains or the court orders otherwise — and must proceed expeditiously to deliver the property in the trustee's possession to the cotrustee, the successor or the person entitled to it.
A.R.S. § 14-10708 ↗ Compensation of trustee: Where the terms do not specify the trustee's compensation, the trustee is entitled to compensation that is reasonable under the circumstances; where the terms specify it or refer to an ascertainable source, the trustee is compensated as specified, but the court may allow more or less where the duties are substantially different from those contemplated at the trust's creation or the specified compensation would be unreasonably low or high.
A.R.S. § 14-10709 ↗ Reimbursement of expenses: A trustee is entitled to reimbursement from the trust property, with reasonable interest, for expenses properly incurred in the administration and, to the extent necessary to prevent the trust's unjust enrichment, for expenses not properly incurred; an advance by the trustee of money for the trust's protection creates a lien on the trust property to secure reimbursement with reasonable interest.

Article 8: Duties and powers of trustee

A.R.S. § 14-10801 ↗ Duty to administer trust: On accepting a trusteeship, the trustee administers the trust in good faith, in accordance with its terms and purposes and the interests of the beneficiaries, and in accordance with the chapter.
A.R.S. § 14-10802 ↗ Duty of loyalty: The trustee administers the trust solely in the interests of the beneficiaries; a sale, encumbrance or other transaction involving trust property entered into for the trustee's own account, or otherwise affected by a conflict between the trustee's fiduciary and personal interests, is voidable by an affected beneficiary unless the terms authorized it, the court approved it, the beneficiary's time to sue under section 14-11005 passed, the beneficiary consented, ratified or released, or the trustee's contract or claim predates the trusteeship; a transaction with the trustee's spouse, descendants, siblings, parents or their spouses, the trustee's agent or attorney, or an enterprise in which the trustee has an interest that might affect the trustee's judgment is presumed to be affected by a conflict; a transaction with a beneficiary not concerning trust property from which the trustee gains an advantage is voidable unless fair; the trustee votes shares in the beneficiaries' best interests; and agreements on appointment or compensation, reasonable compensation, transactions between related fiduciary accounts, deposits in the trustee's own regulated institution and advances for the trust's protection are allowed if fair to the beneficiaries.
A.R.S. § 14-10803 ↗ Impartiality: Where a trust has two or more beneficiaries, the trustee acts impartially in investing, managing and distributing the trust property, giving due regard to the beneficiaries' respective interests.
A.R.S. § 14-10804 ↗ Prudent administration: The trustee administers the trust as a prudent person would, considering the purposes, terms, distributional requirements and other circumstances of the trust, and exercises reasonable care, skill and caution.
A.R.S. § 14-10805 ↗ Costs of administration: In administering a trust the trustee may incur only costs that are reasonable in relation to the trust property, the purposes of the trust and the skills of the trustee.
A.R.S. § 14-10806 ↗ Trustee's skills: A trustee who has special skills or expertise, or who was named in reliance on a representation of special skills or expertise, must use them.
A.R.S. § 14-10807 ↗ Delegation by trustee: A trustee may delegate duties and powers that a prudent trustee of comparable skills could properly delegate, exercising reasonable care, skill and caution in selecting the agent, setting the scope and terms of the delegation consistently with the trust's purposes and terms, and periodically reviewing the agent's performance and compliance; the agent owes the trust a duty of reasonable care in the delegated function; a trustee who complies is not liable for the agent's action; and an agent who accepts a delegation submits to the jurisdiction of Arizona's courts.
A.R.S. § 14-10808 ↗ Powers to direct: While a trust is revocable the trustee may follow a direction of the settlor contrary to the terms; where the trust makes assets subject to the direction of the settlor, a cotrustee, a beneficiary or a third party, the trustee has no duty to review the directions or to notify the beneficiaries of investment actions taken under them, is not responsible for the purchase, monitoring, retention or sale of the directed assets, and is not liable for acting on a direction unless the trustee acts in bad faith or with reckless indifference; the terms may confer on a trustee or another person a power to direct the trust's modification or termination; and a person other than a beneficiary who holds a power to direct is presumptively a fiduciary, required to act in good faith with regard to the trust's purposes and the beneficiaries' interests and liable for loss from a breach, unless the instrument provides otherwise.
A.R.S. § 14-10809 ↗ Control and protection of trust property: A trustee takes reasonable steps to take control of and protect the trust property.
A.R.S. § 14-10810 ↗ Record keeping and identification of trust property: A trustee keeps adequate records of the administration, keeps trust property separate from the trustee's own, and causes the trust property to be designated so that the trust's interest, to the extent feasible, appears in records kept by someone other than a trustee or beneficiary; a trustee who keeps records clearly showing the respective interests may invest the property of two or more trusts as a whole.
A.R.S. § 14-10811 ↗ Enforcement and defense of claims: A trustee takes reasonable steps to enforce claims of the trust and to defend claims against the trust.
A.R.S. § 14-10812 ↗ Collecting trust property: A trustee takes reasonable steps to compel a former trustee or other person to deliver trust property to the trustee, and to redress a breach of trust the trustee knows a former trustee committed.
A.R.S. § 14-10813 ↗ Duty to inform and report: Unless the instrument provides otherwise, the trustee keeps the qualified beneficiaries reasonably informed about the administration and the material facts necessary to protect their interests, and promptly responds to a beneficiary's request for information unless unreasonable; on request the trustee promptly furnishes the portions of the instrument that describe the beneficiary's interest; within sixty days after accepting a trusteeship the trustee notifies the qualified beneficiaries of the acceptance and of the trustee's name, address and telephone number; within sixty days after acquiring knowledge of the creation of an irrevocable trust, or that a formerly revocable trust has become irrevocable — by the settlor's death or otherwise — the trustee notifies them of the trust's existence, the identity of the settlor or settlors, the trustee's contact details, the right to request a copy of the relevant portions of the instrument and the right to a trustee's report; the trustee gives at least thirty days' advance notice of a change in the method or rate of compensation; at least annually and at termination the trustee sends the distributees, permissible distributees and requesting beneficiaries a report of the trust property, liabilities, receipts and disbursements, the source and amount of the trustee's compensation, a listing of the assets and, if feasible, their market values — a former trustee reports on a vacancy with no cotrustee; a beneficiary may waive a report or other information and may withdraw the waiver; the two sixty-day notices apply only to a trustee who accepts, an irrevocable trust created, or a revocable trust that becomes irrevocable on or after January 1, 2009; and a person entitled only to specific distributions already made is not a qualified beneficiary for these purposes except for the notice of acceptance.
A.R.S. § 14-10814 ↗ Discretionary powers; tax savings: However broad the discretion the terms grant — absolute, sole or uncontrolled — the trustee exercises a discretionary power in good faith, in accordance with the terms and purposes of the trust and the interests of the beneficiaries, as to the beneficiaries and the trust's creditors only; unless the terms say otherwise, a nonsettlor trustee-beneficiary may make discretionary distributions to or for the trustee's own benefit only under an ascertainable standard of health, education, support or maintenance, a trustee may not use a discretionary power to satisfy the trustee's own legal support obligation, and a settlor-trustee of a trust other than a special needs trust may distribute to a beneficiary only under such a standard; a power so limited may be exercised by the other trustees or, where all are limited, by a special fiduciary the court appoints; the limits do not apply to a trustee-spouse of a marital-deduction trust, to a trust while revocable or to an annual-exclusion trust.
A.R.S. § 14-10815 ↗ General powers of trustee: Without court authorization a trustee may exercise the powers the terms confer and, except as the terms limit, all powers over the trust property that an unmarried competent owner has over individually owned property, any other powers appropriate to the proper investment, management and distribution of the trust property and any other powers the chapter confers; the exercise of a power by a fiduciary is subject to the article's fiduciary duties.
A.R.S. § 14-10816 ↗ Specific powers of trustee: Lists the trustee's specific powers: to collect property and accept or reject additions; to acquire or sell property at public or private sale; to exchange, partition or change the character of property; to deposit money in a regulated financial institution; to borrow and to mortgage or pledge; to continue a business and act as its owner; to exercise an owner's rights over securities; to improve, repair, develop or dedicate real property; to lease; to grant and acquire options; to insure; to abandon valueless property; to address environmental liability; to pay, contest, settle or release claims; to pay taxes, compensation and expenses; to make tax elections; to select payment modes under benefit plans and insurance; to lend to a beneficiary with a lien on future distributions and to pledge property to guarantee a beneficiary's loan; to appoint an ancillary trustee; to pay a distribution for a beneficiary under a disability to the beneficiary, a conservator, guardian, custodian, custodial trustee, caretaker or a separate fund; on distribution, division or termination to distribute in divided or undivided interests, allocate particular assets including community property in proportionate or disproportionate shares — a division of community property in and out of the trust may be made by equal value rather than proportionately — and value and adjust accordingly; to resolve disputes by mediation or arbitration; to prosecute or defend proceedings; to sign and deliver instruments; and on termination to wind up and distribute.
A.R.S. § 14-10817 ↗ Distribution on termination; release of trustee: On a termination or partial termination the trustee may send the beneficiaries a proposal for distribution, and a beneficiary's right to object ends if the beneficiary does not notify the trustee of an objection within thirty days after the proposal was sent, provided the proposal informed the beneficiary of the right to object and of the time allowed; on an event terminating the trust the trustee distributes within a reasonable time to the persons entitled, subject to retaining a reasonable reserve for debts, expenses and taxes; and a beneficiary's release of the trustee from liability for breach is invalid to the extent it was induced by the trustee's improper conduct or the beneficiary did not know of the beneficiary's rights or of the material facts.
A.R.S. § 14-10818 ↗ Trust protector: A trust instrument may appoint a trust protector — a person designated with that title or with similar powers, other than a beneficiary — who has the powers, delegations and functions the instrument confers, which may include removing and appointing a trustee, modifying or amending the instrument for any valid purpose including tax status, increasing, decreasing or restricting a beneficiary's interest, modifying a power of appointment and changing the governing law; a modification may not grant a beneficial interest to anyone the instrument does not provide for or modify a governmental unit's interest in a special needs trust; except as the instrument provides, a trust protector is not a trustee or fiduciary and is not liable or accountable as one, a rule that does not reach a trust irrevocable before January 1, 2009 whose settlor may remove and replace the protector; and the exercise of a protector's power is a special power of appointment.
A.R.S. § 14-10819 ↗ Trustee's special power to appoint to other trust: Unless the terms expressly provide otherwise, a trustee with discretion under a testamentary instrument or an irrevocable inter vivos agreement to make distributions to or for a beneficiary may, without prior court approval, appoint part or all of the trust property to the trustee of another trust — provided the exercise does not reduce a fixed nondiscretionary income payment or alter a nondiscretionary annuity or unitrust payment, is in favor of the trust's beneficiaries, keeps any ascertainable standard the same or more restrictive where the appointing trustee is a possible beneficiary, does not adversely affect the tax treatment of the trust, the trustee, the settlor or the beneficiaries, and does not violate the limits of sections 14-2901 and 14-2905; the exercise is a special power of appointment, the trustee may ask the court to approve it before or after, and the trustee may exercise it by restating the instrument.
A.R.S. § 14-10820 ↗ Fiduciaries; service as trustee; limitation: A person whose fiduciary license has been suspended or revoked under section 14-5651 may not serve as a trustee in any capacity unless related to the beneficiary by blood, adoption or marriage, a bar that lifts when the license is reinstated and in good standing.

Article 9: Prudent investor rule

A.R.S. § 14-10901 ↗ Prudent investor rule: A trustee who invests and manages trust assets owes the beneficiaries a duty to comply with the prudent investor rule of the article, a default rule the trust's provisions may expand, restrict, eliminate or otherwise alter; a trustee is not liable to a beneficiary to the extent the trustee acted in reasonable reliance on the trust's provisions.
A.R.S. § 14-10902 ↗ Standard of care; portfolio strategy; risk and return objectives: A trustee invests and manages trust assets as a prudent investor would, considering the trust's purposes, terms, distribution requirements and other circumstances, with reasonable care, skill and caution; individual decisions are evaluated in the context of the whole portfolio and an overall strategy with risk and return objectives suited to the trust; the trustee considers general economic conditions, inflation or deflation, tax consequences, each investment's role in the portfolio, expected total return, the beneficiaries' other resources, needs for liquidity, regular income and preservation or appreciation of capital, and an asset's special value to the trust or a beneficiary; makes a reasonable effort to verify relevant facts; and may invest in any kind of property consistent with the article.
A.R.S. § 14-10903 ↗ Diversification: A trustee diversifies the trust's investments unless the trustee reasonably determines that, because of special circumstances, the trust's purposes are better served without diversifying.
A.R.S. § 14-10904 ↗ Duties at inception of trusteeship: Within a reasonable time after accepting a trusteeship or receiving trust assets, a trustee reviews the trust assets and makes and implements decisions on retaining and disposing of them, to bring the portfolio into compliance with the trust's purposes, terms, distribution requirements and other circumstances and with the article.
A.R.S. § 14-10907 ↗ Delegation of investment and management functions; duties; limitations: A fiduciary may delegate investment and management functions a prudent investor of comparable skills might delegate, and is not responsible for the investment agent's decisions where the fiduciary exercised reasonable care, skill and caution in selecting the agent, setting the scope and terms of the delegation and periodically reviewing the agent's performance and compliance; the agent must comply with the delegation's scope and terms with reasonable care, skill and caution and is liable to the trust for failing to, submits to the jurisdiction of Arizona's courts, and must use any special skills the agent claims; a cofiduciary may delegate to a cofiduciary reasonably believed to have greater investment skills; and an investment in a mutual fund is not a delegation.
A.R.S. § 14-10908 ↗ Life insurance on settlor; liability of trustee: A trustee may acquire or retain a life insurance contract on the settlor or the settlor's spouse without liability for a loss from failing to determine whether the contract is or remains a proper investment, to investigate the insurer's financial strength, to exercise nonforfeiture provisions or to diversify the contract.

Article 10: Liability of trustees and rights of persons dealing with trustee

A.R.S. § 14-11001 ↗ Remedies for breach of trust: A trustee's violation of a duty owed to a beneficiary is a breach of trust; to remedy one that has occurred or may occur, the court may compel the trustee to perform the duties, enjoin a breach, compel redress by paying money, restoring property or other means, order an account, appoint a special fiduciary to take possession of the property and administer the trust, suspend or remove the trustee, reduce or deny compensation, void an act, impose a lien or constructive trust or trace and recover property wrongfully disposed of, or order any other appropriate relief.
A.R.S. § 14-11002 ↗ Damages for breach of trust: A trustee who commits a breach of trust is liable to the affected beneficiaries for the greater of the amount required to restore the value of the trust property and distributions to what they would have been without the breach and the profit the trustee made from it; where more than one trustee is liable, a trustee is entitled to contribution from the others unless substantially more at fault, acting in bad faith or with reckless indifference, or to the extent of a benefit the trustee received.
A.R.S. § 14-11004 ↗ Attorney fees and costs: A trustee, or a person nominated as trustee, is entitled to reimbursement from the trust for reasonable fees, expenses and disbursements, including attorney fees and costs, arising from the good-faith defense or prosecution of a judicial or alternative dispute resolution proceeding involving the trust's administration, whether or not successful; a court or arbitrator may order a party's reasonable fees paid by another party or by the trust.
A.R.S. § 14-11005 ↗ Limitation of action against trustee: A beneficiary may not commence a proceeding against a trustee for breach of trust more than one year after the date the beneficiary, or the beneficiary's representative, was sent a report that adequately disclosed the existence of a potential claim for breach and informed the beneficiary of the time allowed for commencing a proceeding; a report adequately discloses a potential claim if it provides enough information that the beneficiary knows of the claim or should have inquired into its existence; where that one-year rule does not apply, a proceeding must be commenced within two years after the first of the trustee's removal, resignation or death, the termination of the beneficiary's interest and the termination of the trust.
A.R.S. § 14-11010 ↗ Limitation on personal liability of trustee: A trustee is not personally liable on a contract properly entered into in a fiduciary capacity in the course of administering the trust if the contract disclosed the fiduciary capacity, unless the contract provides otherwise; a trustee is personally liable for torts committed in the administration, or for obligations arising from ownership or control of trust property including environmental violations, only if personally at fault; and such a claim may be asserted against the trustee in the fiduciary capacity whether or not the trustee is personally liable.
A.R.S. § 14-11012 ↗ Protection of person dealing with trustee: A person other than a beneficiary who in good faith assists a trustee, or deals with one for value, without knowledge that the trustee is exceeding or improperly exercising the trustee's powers, is protected as if the power were properly exercised, need not inquire into the extent of the powers or the propriety of their exercise, and need not ensure the proper application of assets delivered; the same protection covers good-faith dealings with a former trustee without knowledge that the trusteeship ended; comparable protections of commercial and securities law prevail.
A.R.S. § 14-11013 ↗ Certification of trust: Instead of furnishing a copy of the trust instrument to a person other than a beneficiary, the trustee may furnish a certification of trust stating that the trust exists and the date the instrument was executed, the identity of the settlor, the identity and address of the currently acting trustee, the trustee's powers, whether the trust is revocable or irrevocable and who holds a power to revoke, the authority of cotrustees to sign and whether all or fewer than all must act, and the manner of taking title to trust property; any trustee may sign it; it must state that the trust has not been revoked, modified or amended in any manner that would make its representations incorrect; it need not contain the dispositive terms; a good-faith recipient may require the excerpts that designate the trustee and confer the power to act in the pending transaction, but may demand the dispositive terms or successor-trustee provisions only with a verified statement of a reasonable basis; a person who relies on a certification without actual knowledge that it is incorrect is protected and may enforce the transaction; a person who demands the instrument without good faith or outside the section's limits is liable for damages, costs and attorney fees; and the section does not limit a person's right to the instrument in a judicial proceeding.

Article 11: Total return trusts

A.R.S. § 14-11014 ↗ Total return trusts; definitions: A trustee other than an interested trustee — or a majority of the uninterested trustees — may convert an income trust to a total return unitrust, reconvert, or change the unitrust percentage or the valuation method without court approval by adopting a written policy and sending written notice of the intended action, with the policy and a copy of the section, to the living settlor, all qualified beneficiaries and every adviser or trust protector, provided at least one of those recipients is legally competent and no recipient objects by a written instrument delivered to the trustee within thirty days after receipt; an interested trustee may do the same only through a disinterested person who sets the percentage, the valuation method and any excluded assets; otherwise the trustee may petition the court; the fair market value is determined at least annually, the percentage is a reasonable current return between three and five per cent, the section states how the unitrust amount is sourced for tax purposes and how it may be administered, a marital-deduction spouse may prohibit conversion and compel reconversion, a trustee acting in good faith is not liable, and the section applies to trusts administered in Arizona or governed by Arizona law unless the instrument shows a contrary intent, the trust is a pooled income fund or charitable remainder annuity trust, or the instrument expressly prohibits its use.

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