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Chapter 5801: Ohio Trust Code — General Provisions

R.C. 5801.01 ↗ General definitions: Defines the terms of the Ohio Trust Code — among them "beneficiary" (a person with a present or future beneficial interest, vested or contingent, a non-trustee holder of a power of appointment over trust property, or a charitable organization expressly designated in the terms to receive distributions); "beneficiary surrogate" (a person other than a trustee whom the settlor designates in the trust instrument to receive the notices, information and reports otherwise owed to a current beneficiary under divisions (B)(8) and (9) of section 5801.04); "current beneficiary" (a beneficiary that, on the date the beneficiary's qualification is determined, is a distributee or permissible distributee of trust income or principal); "qualified beneficiary" (a current distributee or permissible distributee, a person who would be one if the current interests ended on that date without ending the trust, or a person who would be one if the trust terminated on that date); "revocable" (revocable at the time of determination by the settlor alone or with the consent of a person without an adverse interest, unaffected by the settlor's lack of capacity); "settlor" (a person, including a testator, who creates or contributes property to a trust); "spendthrift provision"; "terms of a trust"; "trust instrument"; "trustee" (original, additional, successor and cotrustee); and the "wholly discretionary trust" — an irrevocable trust whose distributions to a beneficiary may or shall be made only at the trustee's discretion, described as sole, absolute or uncontrolled, with no standards to guide it and no power of withdrawal, where the beneficiary is not the settlor, the trustee or a cotrustee and cannot become one.
R.C. 5801.011 ↗ Short title: Chapters 5801. to 5811. of the Revised Code may be cited as the Ohio trust code.
R.C. 5801.02 ↗ Application of trust chapters: Except as a provision of Chapters 5801. to 5811. otherwise provides, those chapters apply to charitable and noncharitable inter vivos express trusts and to trusts created under a statute, judgment or decree that requires administration in the manner of an express trust; they apply to charitable and noncharitable testamentary trusts to the extent section 2109.69 provides.
R.C. 5801.03 ↗ Actual and constructive knowledge of facts: A person has knowledge of a fact when the person has actual knowledge of it, has received notice or notification of it, or, from all the facts and circumstances known at the time, has reason to know it. An organization acting through employees has notice or knowledge of a fact involving a trust only from the time the employee responsible for acting for the trust received the information or would have, had the organization exercised reasonable diligence — reasonable routines for communicating significant information to that employee, reasonably complied with.
R.C. 5801.04 ↗ Trustee powers, duties, and relations - beneficiaries' rights: Except as the terms of the trust otherwise provide, the Ohio Trust Code governs a trustee's duties and powers, relations among trustees and the rights and interests of a beneficiary; the terms prevail over the code except for fourteen rules — among them the requirements for creating a trust, the duty to act in good faith and in accordance with the purposes of the trust, a lawful purpose, the court's powers to modify or terminate a trust and to adjust a bond or a trustee's compensation that is unreasonably low or high, the effect of a spendthrift provision, the duty under divisions (B)(2) and (3) of section 5808.13 to notify current beneficiaries of an irrevocable trust who have attained twenty-five years of age of the trust's existence, the trustee's identity and their right to request trustee's reports, the duty under division (A) of section 5808.13 to respond to such a beneficiary's request for reports and information, the effect of an exculpatory term, the rights of persons other than a trustee or beneficiary, periods of limitation and the court's jurisdiction. The settlor may waive or modify those two notice-and-information duties for one or more current beneficiaries only by designating in the trust instrument one or more beneficiary surrogates, who then receive the notices, information and reports in the beneficiaries' place and act in good faith to protect their interests, for so long as a surrogate or a designated successor serves.
R.C. 5801.05 ↗ Application of common law and equity principles: The common law of trusts and principles of equity continue to apply in Ohio except to the extent Chapters 5801. to 5811. or another section of the Revised Code modify them.
R.C. 5801.06 ↗ Designated jurisdiction - controlling law: The law of the jurisdiction the terms of a trust designate determines the meaning and effect of the terms unless the designation is contrary to a strong public policy of the jurisdiction with the most significant relationship to the matter at issue; absent a controlling designation, that jurisdiction's law governs. The administration of a trust is governed by the law the terms designate for administration; where the terms designate none, by the law of the trust's principal place of administration, and after a transfer under section 5801.07, by the law of the new principal place from the time of the transfer.
R.C. 5801.07 ↗ Connection with designated jurisdiction - transfer: Terms designating the trust's principal place of administration are valid and controlling if a trustee's principal place of business is in, or a trustee is a resident of, the designated jurisdiction, or all 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, its administration and the interests of the beneficiaries, and in furtherance of that duty may transfer the principal place of administration to another state or to a jurisdiction outside the United States — after notice to the current beneficiaries not less than sixty days before initiating the transfer, naming the new jurisdiction, the address and telephone number at the new location, the reasons and the expected date — and may transfer some or all of the property to a successor trustee designated in the terms or appointed under section 5807.04.
R.C. 5801.08 ↗ Methods of notice - waiver: Notice to a person, or the sending of a document, under the Ohio Trust Code is 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 place of business, or a properly directed electronic message. Notice is not required 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; notice of a judicial proceeding is given as the rules of civil procedure provide.
R.C. 5801.09 ↗ Notice to beneficiary by request: Whenever the Ohio Trust Code requires notice to current or qualified beneficiaries, the trustee also gives notice to any other beneficiary who has sent the trustee a request for notice. A person appointed to enforce a trust for the care of an animal or for another noncharitable purpose has the rights of a current beneficiary.
R.C. 5801.10 ↗ Agreement among interested parties regarding trust matters: Two or more of the settlor (if living and without adverse tax results), the beneficiaries, the currently serving trustees and the creditors whose interests are affected — or their representatives under Chapter 5803., with the attorney general where a tax-related construction concerns a charitable interest — may by written instrument agree on any matter concerning the construction of, administration of or distributions under the terms of the trust, the investment of income or principal, or other matters: determining classes of creditors, beneficiaries or heirs; resolving disputes, including over the instrument's language; granting the trustee necessary or desirable powers; modifying the terms where not inconsistent with a material purpose; qualifying gifts for the charitable or marital deduction; construing tax-related terms to give effect to the settlor's intent; and any other matter under the code. The agreement may not terminate the trust before the date its terms specify, change the beneficiaries' interests except as the listed modifications need, or include terms a court could not properly approve, and may not affect a creditor's rights without consent; only the settlor and any trustee need be parties to an amendment of a revocable trust. A compliant agreement is final and binding on its parties and the persons they represent and on no one else; a trustee represents only its own interests in negotiating it; any party may ask the court to approve the agreement and to determine whether the representation was adequate and whether its terms could have been approved; an arbitration provision in it is enforceable; a trustee acting in good-faith reliance on it is not liable to third persons for a loss; and the section is liberally construed and does not apply to the charitable trusts it names.
R.C. 5801.11 ↗ Guardian to comply with duties under RC Chapter 2111: A guardian of the estate or of the person, in acting under the Ohio Trust Code, complies with the guardian's duties under Chapter 2111. or other applicable law.
R.C. 5801.12 ↗ Children born through the use of assisted reproductive technologies: Governs the beneficial rights under a revocable or irrevocable trust of a child born through assisted reproductive technologies, and the exercise of a power of appointment or another power to expand a class of beneficiaries: no child of a settlor born through such technologies more than three hundred days after the settlor's death is the settlor's child under the instrument, and no other such person born more than three hundred days after the event that closed a class is in the class, unless the terms clearly provide otherwise. Where the terms provide for such a child and a period within which the child must be born, that period applies up to five years from the settlor's death or the class-closing event; where they provide no period, the child must be born within one year and three hundred days of that date.
R.C. 5801.20 ↗ Definitions: Defines the terms of the optional closing and succession process of sections 5801.20 to 5801.24: the "applicable reporting period" (the most recent four years as of the notice's preparation, or the period since the trust became irrevocable or since the noticing trustee accepted, where shorter); the "departing trustee"; the "distributions objection period" and the "trustee succession objection period" (each forty-five days from the date the notice and trustee's reports are served); the "terminating distributions necessary parties" (the current beneficiaries at the notice date, every living person who was a current beneficiary immediately before a triggering event that is the basis for a mandatory distribution, and any co-trustee); the "resignation or removal necessary parties" (the persons the terms name for notice of the resignation or removal together with the other current beneficiaries, or, where the terms name no one for a resignation, the qualified beneficiaries, with any co-trustee and the successor trustee); the "successor trustee"; the "triggering event"; "trust-terminating distributions" (including distributions under section 5808.18); the "trustee indemnification clause"; and the "trustee's report" (a report described in division (C) of section 5808.13).
R.C. 5801.21 ↗ Concluding trustee's administration of irrevocable trust: A trustee may, but is not required to, use the process of sections 5801.22 and 5801.23 when concluding the administration of an irrevocable trust; the process does not apply to a testamentary trust under a probate court's supervision; it may be used in combination with or in lieu of other options or proceedings under the Revised Code or the common law; and a trustee's substantial good-faith compliance with the contents the notices require is deemed sufficient.
R.C. 5801.22 ↗ Termination of irrevocable trust as a result of trust-terminating distributions: Where a trust is to terminate through trust-terminating distributions and the trustee elects this section, the trustee serves on the terminating distributions necessary parties, within a reasonable time after the event or determination that requires or authorizes the distributions, a written notice — dated; describing the terms or statute that require or authorize the distributions and any triggering event; naming the proposed distributees and the assets proposed for each; describing the forty-five-day distributions objection period and where objections are sent, the process with and without an objection and the impending bar of claims; stating that the trustee may rely on a recipient's written consent and irrevocable waiver and may complete the distributions early when everyone served consents; with an exhibit of the assets on hand and their values and an estimate of the items still to be received or disbursed, including trustee fees — together with trustee's reports covering the applicable reporting period. With no timely written objection, the notice and reports are considered approved, the trustee distributes within a reasonable time, and each person served is barred from a claim against the trustee for breach of trust as to the matters disclosed and all other matters of the administration and from challenging the trust's validity, with the preclusive effect of a final order settling a full account notwithstanding section 5810.05; where every necessary party and every qualified beneficiary was served and consented or failed to object, all other beneficiaries are barred too. A timely objection is submitted to the court or resolved with the objector — by withdrawal, a written instrument or an agreement under section 5801.10, which may include a release and an indemnification clause — and the trustee then distributes as resolved. A barred distributee may be required to return assets the trustee needs to pay the trust's taxes, debts or expenses.
R.C. 5801.23 ↗ Termination of irrevocable trust as a result of trustee resignation or removal: Where a trustee resigns or is removed from an irrevocable trust and elects this section, the departing trustee serves on the resignation or removal necessary parties, within a reasonable time after the resignation or removal, a written notice — dated; describing the terms or statute relevant to the resignation or removal and to the successor's appointment or designation, the actions taken, the successor's name and address and, where applicable, the successor's acceptance; describing the forty-five-day trustee succession objection period and where objections are sent, the process with and without an objection and the impending bar of claims; stating that the departing trustee may rely on a recipient's written consent and irrevocable waiver and may deliver the net assets early when everyone served consents; with an exhibit of the assets on hand and their values and an estimate of the items still to be received or disbursed, including trustee fees — together with trustee's reports covering the applicable reporting period. With no timely objection, the notice and reports are considered approved, the departing trustee delivers the net trust assets to the successor trustee or the co-trustees within a reasonable time, and each person served — and, where every necessary party and every qualified beneficiary was served, every other beneficiary — is barred from a claim against the departing trustee as to the matters disclosed and all other matters of the administration and from challenging the trust's validity, with the preclusive effect of a final order settling a full account. A timely objection is submitted to the court or resolved with the objector, and the assets are then delivered as resolved.
R.C. 5801.24 ↗ Delivery of notices and trustee's reports: A notice and trustee's reports under section 5801.22 or 5801.23 are served by handing them to the person; by leaving them at the person's office with the person in charge or in a conspicuous place, or at the person's dwelling with someone of suitable age and discretion who resides there; by United States mail to the last known address (complete on mailing); by a commercial carrier for delivery within three calendar days (complete on delivery to the carrier); or by facsimile or electronic mail to a number or address the person or the person's attorney provided (complete on transmission unless the trustee learns they did not arrive). Where the fiduciary of a deceased beneficiary's estate or of a subtrust and one or more of that estate's or subtrust's beneficiaries are served and both consent or fail to object, the beneficiary is barred to the same extent from a claim against the fiduciary for failing to object. No trustee may request or include a trustee indemnification clause in the notice or the documents served with it; after a written objection, such a clause may be included in the agreement or instrument the objecting party executes.

Chapter 5802: Jurisdiction of Court

R.C. 5802.01 ↗ Judicial intervention in trust administration: A court may intervene in the administration of a trust to the extent an interested person invokes its jurisdiction or as the law provides. An inter vivos trust is not subject to continuing judicial supervision unless the court orders it; a trust created under a statute, judgment or decree is supervised to the extent the statute, judgment, decree or a court order provides. A judicial proceeding may relate to any matter involving the administration, including a request for instructions and an action to declare rights.
R.C. 5802.02 ↗ Personal jurisdiction over trustee and beneficiaries: By accepting the trusteeship of a trust whose principal place of administration is in Ohio, or by moving the principal place of administration here, a trustee submits personally to the jurisdiction of Ohio's courts regarding any matter involving the trust; the beneficiaries of such a trust are subject to that jurisdiction as to their interests, and a recipient submits to it by accepting a distribution. Other methods of obtaining jurisdiction are not precluded.
R.C. 5802.03 ↗ Concurrent jurisdiction regarding inter vivos trust: The probate division of the court of common pleas has concurrent jurisdiction with, and the same powers at law and in equity as, the general division to issue writs and orders and to hear and determine any action that involves an inter vivos trust. The probate division has exclusive jurisdiction to render declaratory judgments under Chapter 5817. — the validity of a will or trust during the maker's lifetime — which it may transfer to the general division under section 5817.04.
R.C. 5802.04 ↗ Nature of action: An action under the Ohio Trust Code is a civil action subject to the Rules of Civil Procedure and, unless it involves a testamentary or other trust already under court supervision, is commenced by filing a complaint.
R.C. 5802.05 ↗ Provision regarding arbitration of disputes: A provision in the terms of a trust, other than a testamentary trust, requiring arbitration of disputes — other than disputes over the validity of all or part of the instrument — between or among the beneficiaries and a fiduciary is enforceable and, unless the terms specify otherwise, is presumed to require binding arbitration under Chapter 2711.

Chapter 5803: Representatives

R.C. 5803.01 ↗ Notice to and consent by representative: Notice to a person who may represent and bind another under Chapter 5803. has the same effect as notice to the other, and the representative's consent binds the person represented unless that person objects before the consent would otherwise have become effective. Except as sections 5804.11 and 5806.02 provide, a person who may represent a settlor lacking capacity may receive notice and give a binding consent for the settlor; a settlor may not represent and bind a beneficiary as to a modification or termination under division (A) of section 5804.11.
R.C. 5803.02 ↗ Holder of power of appointment may represent persons subject to power: To the extent there is no conflict of interest on the particular question, the holder of a general testamentary power of appointment may represent and bind the permissible appointees, takers in default and others whose interests are subject to the power, and the holder of a limited testamentary power or a presently exercisable limited power may represent and bind the possible appointees; the rights of the holder of a presently exercisable general power are governed by section 5806.03.
R.C. 5803.03 ↗ Powers of representative: To the extent there is no conflict of interest on the particular question: a guardian of the estate may represent and bind the estate the guardian controls; a guardian of the person may represent and bind the ward where no guardian of the estate is appointed; an agent with authority over the question may represent and bind the principal; a trustee may represent and bind the beneficiaries, except in a private settlement agreement under section 5801.10; a personal representative may represent and bind the persons interested in a decedent's estate; and a parent may represent and bind the parent's minor or unborn child where no guardian has been appointed.
R.C. 5803.04 ↗ Representation by person having same interest: Unless otherwise represented, a minor, an incapacitated individual, an unborn individual or a person whose identity or location is unknown and not reasonably ascertainable may be represented by and bound by another person with a substantially identical interest on the particular question, to the extent there is no conflict of interest between them.
R.C. 5803.05 ↗ Appointment to represent unrepresented interest: Where an interest is not represented under Chapter 5803., 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 individual, an unborn individual or a person whose identity or location is unknown — one representative may serve several persons — on any matter under the Ohio Trust Code, whether or not a proceeding is pending; in deciding, a representative may consider the general benefit to the living members of the individual's family.

Chapter 5804: Creation, Modification, Revocation, and Termination

R.C. 5804.01 ↗ Methods of creation of trusts: A trust may be created by a transfer of property to another person as trustee during the settlor's lifetime or by will or other disposition taking effect at the settlor's death; by the owner's declaration that the owner holds identifiable property as trustee; by the exercise of a power of appointment in favor of a trustee; or by a court order.
R.C. 5804.02 ↗ General requirements for creation of trust: A trust is created only if the settlor (other than the settlor of a court-ordered trust) has capacity and indicates an intention to create it, the trust has a definite beneficiary or is a charitable trust, an animal-care trust under section 5804.08 or a noncharitable-purpose trust under section 5804.09, 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; a power to select a beneficiary from an indefinite class is valid and fails if not exercised within a reasonable time; a trust is valid regardless of the existence, size or character of its corpus; a trust is not invalid because a person is or may become the sole trustee and sole holder of the present enjoyment where others hold a vested, contingent or expectant interest afterward, and no merger occurs. An agent under a power of attorney may create a trust for the principal only as sections 1337.21 to 1337.64 provide.
R.C. 5804.03 ↗ Validity of nontestamentary trusts: A trust not created by will is validly created if its creation complies with the law of the jurisdiction where the instrument was executed, or of a jurisdiction where, at creation, the settlor was domiciled, had a place of abode or was a national, a trustee was domiciled or had a place of business, or any trust property was located.
R.C. 5804.04 ↗ Trust purposes must be legitimate: A trust may be created only to the extent its purposes are lawful, not contrary to public policy and possible to achieve; a trust exists, and its assets are held, for the benefit of its beneficiaries in accordance with their interests in the trust.
R.C. 5804.05 ↗ Purposes of charitable trust - enforcement: A charitable trust may be created for the relief of poverty, the advancement of education or religion, the promotion of health, governmental or municipal purposes, or other purposes whose achievement is beneficial to the community; where the terms indicate no particular charitable purpose or beneficiary, the court may select one consistent with the settlor's intention; the settlor, among others, may maintain a proceeding to enforce the trust.
R.C. 5804.06 ↗ Trust induced by fraud, duress, or undue influence void: A trust is void to the extent its creation was induced by fraud, duress or undue influence — terms that carry the meanings they have for the validity of a will.
R.C. 5804.07 ↗ Written instrument not required: Except as a section of the Revised Code outside the Ohio Trust Code requires, a trust need not be evidenced by a trust instrument, but the creation of an oral trust and its terms may be established only by clear and convincing evidence.
R.C. 5804.08 ↗ Trust to provide for care of animal: A trust may be created to provide for the care of an animal alive during the settlor's lifetime; it terminates on the death of the animal or of the last surviving animal; it is enforced by a person the terms appoint or the court appoints, and a person interested in the animal's welfare may ask the court to appoint or remove an enforcer; the property may be applied only to its intended use, and property the court finds exceeds that use, or that is not required for it, passes to the settlor if living or to the settlor's successors in interest unless the terms provide otherwise.
R.C. 5804.09 ↗ Trust created for noncharitable purpose: A trust may be created for a noncharitable purpose without a definite or definitely ascertainable beneficiary, or for a noncharitable but otherwise valid purpose the trustee selects, and may not be enforced for more than twenty-one years; it is enforced by a person the terms or the court appoints; the property may be applied only to its intended use, and the excess or the unneeded property passes to the settlor if living or to the settlor's successors in interest unless the terms provide otherwise.
R.C. 5804.10 ↗ Termination of trust by revocation or by terms: Beyond the methods of sections 5804.11 to 5804.14, a trust terminates to the extent it is revoked or expires under its terms, a court determines that no purpose remains to be achieved, or a court determines that its purposes have become unlawful or impossible to achieve. A trustee or beneficiary may commence a proceeding to approve or disapprove a proposed modification, termination, combination or division; the settlor may do so under section 5804.11; and the settlor of a charitable trust may seek modification under section 5804.13.
R.C. 5804.11 ↗ Termination or modification of noncharitable irrevocable trust: On petition, where the settlor and all beneficiaries consent to the modification or termination of a noncharitable irrevocable trust, the consents (including a representative's under Chapter 5803.) are valid and the parties competent, the court enters an order approving it even if it is inconsistent with a material purpose; an agent may exercise the settlor's power to consent only to the extent both the power of attorney and the terms expressly authorize it, and a guardian may with the supervising court's approval. On the consent of all the beneficiaries alone, the court may terminate the trust if its continuance is not necessary to achieve any material purpose, or modify it — but not to remove or replace the serving trustee — if the modification is not inconsistent with a material purpose; a spendthrift provision may, but is not presumed to, be a material purpose, and the court may consider extrinsic evidence of the settlor's intent. On termination the trustee distributes as the beneficiaries agree; where not all beneficiaries consent, the court may approve if the trust could have been modified or terminated with everyone's consent and the interests of a non-consenting beneficiary are adequately protected.
R.C. 5804.12 ↗ Judicial action due to change of circumstances: The court may modify the administrative or dispositive terms of a trust, or terminate it, if because of circumstances the settlor did not anticipate the change will further the trust's purposes, making the modification in accordance with the settlor's probable intention; may modify administrative terms whose continuation would be impracticable or impair the administration; orders distribution consistent with the purposes on a termination; and may modify or interpret terms that refer to the federal estate tax, the federal generation-skipping transfer tax or the Ohio estate tax, or that divide property by reference to those taxes, to give effect to the settlor's intent.
R.C. 5804.13 ↗ Judicial action where charitable purpose frustrated: Where a particular charitable purpose becomes unlawful, impracticable or impossible to achieve, the trust does not fail and the property does not revert; the court may apply cy pres to modify or terminate the trust by directing the property to a use consistent with the settlor's charitable purposes, with the attorney general a necessary party under section 109.25. A provision of the terms for an alternative charitable purpose, or for distribution to a noncharitable beneficiary, prevails over cy pres.
R.C. 5804.14 ↗ Termination or modification where costs exceed value: After notice to the qualified beneficiaries, the trustee of an inter vivos trust whose property totals less than one hundred thousand dollars may terminate it on concluding that the value is insufficient to justify the cost of administration — not a charitable trust with charitable organizations as qualified beneficiaries or one whose terms direct distributions to charities on the termination date — and the court may modify or terminate such a trust, or remove the trustee and appoint another, on the same finding. On termination the trustee (or the court) distributes under any provision of the terms for a premature termination, or else among the beneficiaries according to their interests and equitably, considering any agreement among them, the actuarial values of their interests and any preference the terms express. A spendthrift provision does not preclude termination under the section, which does not apply to a conservation or preservation easement.
R.C. 5804.15 ↗ Reformation to conform to settlor's intention: The court may reform the terms of a trust, even if they are unambiguous, to conform them to the settlor's intention where clear and convincing evidence proves that both the settlor's intent and the terms were affected by a mistake of fact or law, whether in expression or inducement.
R.C. 5804.16 ↗ Modification to achieve settlor's tax objectives: To achieve the settlor's tax objectives, the court may modify the terms of a trust in a manner not contrary to the settlor's probable intention, and may give the modification retroactive effect.
R.C. 5804.17 ↗ Combination or division of trusts: After notice to the qualified beneficiaries, a trustee may combine two or more trusts into a single trust or divide a trust into two or more separate trusts if the result does not substantially impair the rights of any beneficiary or have a materially adverse effect on the achievement of the trust's purposes.
R.C. 5804.18 ↗ When certain trust is irrevocable: A trust described in 42 U.S.C. 1396p(d)(4) is irrevocable if its terms prohibit the settlor from revoking it, whether or not the settlor's estate or heirs are named as the remainder beneficiaries at the settlor's death.

Chapter 5805: Spendthrift Trust Provisions

R.C. 5805.01 ↗ Validity and effect of spendthrift provisions: A spendthrift provision is valid only if it restrains both voluntary and involuntary transfer of a beneficiary's interest, or restrains involuntary transfer and permits voluntary transfer only with the consent of a trustee who is not the beneficiary; 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 spendthrift provision, and, except as Chapter 5805. and section 5810.04 provide, a creditor or assignee may not reach the interest or a distribution before the beneficiary receives it; real or tangible personal property the trust owns and makes available for a beneficiary's use or occupancy is not thereby distributed or received.
R.C. 5805.02 ↗ Enforceability and enforcement of spendthrift provisions: Subject to section 5805.03, a spendthrift provision is unenforceable against the beneficiary's child or spouse holding a judgment or court order for support — but only if distributions can be made for the beneficiary's support or the beneficiary is entitled to mandatory distributions — and against a claim of Ohio or the United States to the extent the Revised Code or federal law provides; it is enforceable against the beneficiary's former spouse. Such a claimant may obtain an order attaching present or future distributions, which the court may limit considering the support needs of the beneficiary, the beneficiary's spouse and dependent children or, for a beneficiary receiving public benefits, the beneficiary's supplemental needs. The only exceptions to a spendthrift provision are those in this section, in division (B) of section 5805.05, and in sections 5805.06 and 5810.04.
R.C. 5805.03 ↗ Creditors of discretionary trust beneficiary may not reach interest: Notwithstanding the support and government-claim exceptions of section 5805.02, no creditor or assignee of a beneficiary of a wholly discretionary trust may reach the beneficiary's interest, or a distribution before the beneficiary receives it, by attaching present or future distributions, by judicial sale, by an order compelling the trustee to distribute, or by any other means, whether or not the terms include a spendthrift provision.
R.C. 5805.04 ↗ Creditor may not compel discretionary distribution - exceptions: Whether or not a trust contains a spendthrift provision, a creditor of a beneficiary may not compel a distribution that is subject to the trustee's discretion, even if the discretion is expressed as a standard or has been abused — except Ohio's claim for support of a beneficiary in a state institution where the terms have a support standard and no spendthrift provision. Where the trustee of a trust that is not wholly discretionary has not complied with a distribution standard or has abused a discretion, the court may order a distribution to satisfy a judgment or order for the support of the beneficiary's child or spouse (not a former spouse) where distributions can be made for the beneficiary's support, in the amount that is equitable but not more than the trustee would have had to distribute, unless the settlor explicitly excluded the child or spouse from benefiting. A discretionary interest may not be ordered sold to satisfy a creditor's claim, and a trustee-beneficiary's interest limited by an ascertainable standard is reached only as it would be if the beneficiary were not the trustee.
R.C. 5805.05 ↗ Attachment of mandatory distributions absent spendthrift provision: Where a trust gives a beneficiary the right to one or more mandatory distributions and has no spendthrift provision, the court may authorize a creditor or assignee to attach present or future mandatory distributions or reach the interest by other means, limiting the award as appropriate considering the support needs of the beneficiary, the beneficiary's spouse and dependent children or, for a beneficiary on public benefits, the supplemental needs; in choosing between a sale and a lien, the court weighs the claim's amount and the sale's proceeds against the interest's value to the beneficiary. Whether or not a spendthrift provision exists, a creditor or assignee may reach a mandatory distribution the trustee has not made within a reasonable time after the designated distribution date.
R.C. 5805.06 ↗ Rights of settlor's creditors - power of withdrawal: Whether or not the terms include a spendthrift provision: during the settlor's lifetime the property of a revocable trust is subject to the claims of the settlor's creditors; as to an irrevocable trust, except one governed by the Ohio Legacy Trust Act (Chapter 5816.), a creditor or assignee of the settlor may reach the maximum amount that can be distributed to or for the settlor's benefit, limited to that settlor's portion where there are several settlors; and for a trust under 42 U.S.C. 1396p(d)(4)(A) or (C) the court may limit a settlor's creditor's award considering the beneficiary's supplemental needs. The holder of a power of withdrawal is treated as the settlor of a revocable trust to the extent of the property subject to the power while it may be exercised. Property distributable to the settlor only through another person's nonfiduciary power of appointment, property includable in the settlor's spouse's gross estate or treated as the spouse's transfer, and property that could be paid to a taxing authority or to reimburse the settlor's income tax on trust income are not amounts distributable to the settlor. The section states no rule for the trust's liability after the settlor's death.
R.C. 5805.07 ↗ Trust property not subject to personal obligations of trustee: Trust property is not subject to the personal obligations of the trustee, even if the trustee becomes insolvent or bankrupt.

Chapter 5806: Powers of Settlor

R.C. 5806.01 ↗ Capacity of settlor same as testator: The capacity a settlor needs to create, amend, revoke or add property to a revocable trust, or to direct the actions of its trustee, is the capacity required to make a will.
R.C. 5806.02 ↗ Revocation or amendment of trust: Unless the terms of a trust expressly provide that it is irrevocable, the settlor may revoke or amend it — a rule that does not apply to an instrument executed before January 1, 2007. Where more than one settlor created or funded a revocable trust, either spouse alone may revoke the community-property portion but both must join to amend it, and each settlor may revoke or amend as to the portion attributable to that settlor's contribution, the trustee promptly notifying the other settlors. The settlor revokes or amends by substantial compliance with the terms' method or, where the terms provide none, by any method manifesting clear and convincing evidence of intent — but not by a will or codicil unless the terms expressly allow it. On revocation the trustee delivers the property as the settlor directs. An agent under a power of attorney may exercise the settlor's powers of revocation, amendment or distribution only to the extent both the terms and the power expressly authorize; a guardian only with the supervising court's approval. A trustee who does not know of a revocation or amendment is not liable for acting on the assumption that none occurred.
R.C. 5806.03 ↗ Control of rights of beneficiaries and duties of trustees: During the lifetime of the settlor of a revocable trust, whether or not the settlor has capacity to revoke it, the rights of the beneficiaries are subject to the settlor's control and the trustee's duties — including the duties to inform and report under section 5808.13 — are owed exclusively to the settlor; a recovery for a breach during the settlor's life obtained after the settlor's incapacity or death is apportioned by the court between the settlor (or the settlor's estate) and the trust as equity requires. The holder of a power of withdrawal has a settlor's rights under the section, to the extent of the property subject to the power, while the power may be exercised.
R.C. 5806.04 ↗ Actions concerning certain revocable trusts: An action to contest the validity of a revocable trust made irrevocable by the settlor's death, of an amendment made during the settlor's life, of the trust's revocation during the settlor's life, or of a transfer made to it during the settlor's life is commenced by the earlier of two years after the settlor's death or six months after the trustee sends the person a copy of the trust instrument with a notice of the trust's existence, the trustee's name and address and the time allowed for an action. After the death, the trustee may without liability proceed to distribute under the terms unless the trustee has actual knowledge of a pending contest or receives a potential contestant's written notification of a potential action and the action is actually filed within ninety days after that notification; a beneficiary returns any distribution exceeding the entitlement if the trust, an amendment or a transfer is later held invalid. The section applies to settlors dying on or after July 23, 2002, and no one may contest facts a court decided when the settlor submitted the trust for a declaration of validity under section 5817.10, except a person who should have been named a defendant and was not served.

Chapter 5807: Trustees

R.C. 5807.01 ↗ Acceptance or rejection of trusteeship: A person designated as trustee accepts by substantially complying with a method of acceptance the terms provide or, where the terms provide none or the method is not expressly exclusive, by accepting delivery of the trust property, exercising powers or performing duties as trustee, or otherwise indicating acceptance. A designee 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 designee may act to preserve the trust property if, within a reasonable time after acting, the person sends a rejection to the settlor or, if the settlor is dead or lacks capacity, to a qualified beneficiary, and may inspect or investigate the property to determine potential liability under environmental or other law.
R.C. 5807.02 ↗ Bond of trustee: A trustee gives bond only if the court finds a bond needed to protect the beneficiaries' interests or the terms require it and the court has not dispensed with it; the court may specify the amount, the liabilities and whether sureties are necessary, and may modify or terminate a bond at any time. A regulated financial-service institution qualified to do trust business in Ohio need not give bond even if the terms require it.
R.C. 5807.03 ↗ Cotrustees - delegation - liability: Three or more serving cotrustees may act by majority decision; the remaining cotrustees act during a vacancy. A cotrustee participates in the performance of a trustee's function unless unavailable through absence, illness, disqualification or other temporary incapacity or after properly delegating it to another trustee; when a cotrustee is unavailable and prompt action is necessary, the remaining cotrustee or a majority of them may act. A trustee may delegate to a cotrustee what a prudent trustee of comparable skills could properly delegate, under section 5808.07, and may revoke a delegation that was not irrevocable. A trustee who does not join in another trustee's action is not liable for it, but each trustee exercises reasonable care to prevent a cotrustee's serious breach of trust and to compel its redress — not required, and no liability for the loss, where section 5815.25 applies or where more than one other trustee acts by majority vote; a dissenting trustee who joins an action at the majority's direction after notifying a cotrustee of the dissent is not liable for it.
R.C. 5807.04 ↗ Vacancy defined - priority in filling - additional trustees: A vacancy occurs when a designated trustee rejects, cannot be identified or does not exist, resigns, is disqualified or removed, dies, or has a guardian appointed. A vacancy 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 as successor, then by a person appointed by someone the terms designate to appoint, then by a person the qualified beneficiaries unanimously agree on, then by the court; for a charitable trust, by the designated successor, the designated appointer's appointee, a person the designated charitable organizations select, then the court. The court may appoint an additional trustee or a special fiduciary whenever it considers the appointment necessary for the administration.
R.C. 5807.05 ↗ Resignation of trustee - notice - approval: A trustee may resign on at least thirty days' notice to the qualified beneficiaries, the settlor if living and all cotrustees, or with the court's approval; in approving a resignation the court may impose conditions reasonably necessary to protect the trust property. A resignation does not discharge or affect any liability of the resigning trustee or the sureties on the trustee's bond for the trustee's acts or omissions.
R.C. 5807.06 ↗ Removal of trustee - grounds - protective measures: The settlor, a cotrustee or a beneficiary may ask the court to remove a trustee, or the court may act on its own, for a serious breach of trust, for a lack of cooperation among cotrustees that substantially impairs the administration, or because unfitness, unwillingness or persistent failure to administer effectively makes removal best serve the beneficiaries' interests; pending a decision, or in lieu of or in addition to removal, the court may order the relief of division (B) of section 5810.01 needed to protect the trust property or the beneficiaries.
R.C. 5807.07 ↗ Powers and duties of removed or resigned trustee: Unless a cotrustee remains or the court orders otherwise, a trustee who has resigned or been removed keeps a trustee's duties and the powers necessary to protect the trust property until the property is delivered to a successor or other person entitled to it, and proceeds expeditiously to deliver the property in the trustee's possession to the cotrustee, the successor trustee or that person.
R.C. 5807.08 ↗ Compensation of trustee: Where the terms of a trust do not specify the trustee's compensation, the trustee is entitled to compensation that is reasonable under the circumstances; where they do, the trustee is compensated as specified, but the court may allow more or less if the trustee's duties are substantially different from those contemplated when the trust was created or the specified compensation would be unreasonably low or high.
R.C. 5807.09 ↗ Reimbursement of trustee for administrative expenses: A trustee is reimbursed out of the trust property, with interest as appropriate, 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 of money by the trustee for the protection of the trust gives rise to a lien on trust property to secure reimbursement with reasonable interest.

Chapter 5808: Trust Administration

R.C. 5808.01 ↗ Duties of trustee generally: 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 Ohio Trust Code.
R.C. 5808.02 ↗ Duty of loyalty to beneficiaries - voidable transactions - conflicts of interest: A trustee administers the trust solely in the interests of the beneficiaries. A sale, encumbrance or other transaction involving the investment or management of 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 or another law authorized it, the court approved it, the beneficiary did not sue within the period of section 5810.05, the beneficiary or a representative consented, ratified or released under section 5810.09, or it involves a contract or claim predating the trusteeship; a transaction with the trustee's spouse, descendant, sibling or parent (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 conflicted, and a transaction in the trustee's individual capacity concerning an opportunity properly belonging to the trust is a conflict. An investment another provision of the Revised Code permits is not presumed conflicted if it complies with the prudent investor rule; the trustee votes shares and chooses managers in the beneficiaries' best interests. Not precluded, unless the beneficiaries show unfairness: an agreement with a beneficiary on the trustee's appointment or compensation, payment of reasonable compensation, a transaction with another trust, estate or guardianship of which the trustee is a fiduciary, a deposit in an affiliated regulated financial-services institution, and an advance by the trustee to protect the trust. The court may appoint a special fiduciary to decide a proposed transaction that might violate the section.
R.C. 5808.03 ↗ Multiple beneficiaries - duty of 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.
R.C. 5808.04 ↗ Duty to act as prudent person: A trustee administers the trust as a prudent person would, considering the purposes, terms, distributional requirements and other circumstances of the trust, and in doing so exercises reasonable care, skill and caution.
R.C. 5808.05 ↗ Reasonable administrative costs allowed: Except as the law otherwise permits, a trustee may incur only costs that are appropriate and reasonable in relation to the assets, the purposes of the trust and the trustee's skills.
R.C. 5808.06 ↗ Trustee to use any special skills or expertise: A trustee who has special skills or expertise, or was named in reliance on a representation of having them, uses those special skills or expertise.
R.C. 5808.07 ↗ Delegation of powers and duties: A trustee may delegate duties and powers that a prudent trustee of comparable skills could properly delegate under the circumstances, exercising reasonable care, skill and caution in selecting the agent, cotrustee or other fiduciary, in establishing the scope and terms of the delegation consistent with the trust's purposes and terms, and in periodically reviewing the delegate's actions to monitor performance and compliance; the delegate owes the trust a duty of reasonable care to comply with the terms of the delegation, a trustee who complies is not liable for the delegate's decisions or actions, and the delegate submits to Ohio's jurisdiction by accepting.
R.C. 5808.08 ↗ Direction of settlor contrary to terms - power of modification: While a trust is revocable, the trustee may follow a direction of the settlor contrary to the terms. A trustee is not liable for losses from acting or failing to act where section 5815.25 gives another person powers over the administration. The terms may confer on a trustee or another person a power to direct the modification or termination of the trust, and, except as the terms provide, a person other than a beneficiary who holds a power to direct is presumptively a fiduciary required to act in good faith toward the trust's purposes and the beneficiaries' interests and is liable for a loss from a breach of that duty.
R.C. 5808.09 ↗ Taking control and protection of property: A trustee takes reasonable steps to take control of and protect the trust property.
R.C. 5808.10 ↗ Adequate records of administration: A trustee keeps adequate records of the administration, keeps trust property separate from the trustee's own, and — unless subject to banking regulation, and except as section 2131.21 provides — causes the trust property to be designated so that the trust's interest appears, so far as feasible, in records a party other than a trustee or beneficiary maintains; a trustee keeping records that clearly show the respective interests may invest the property of two or more trusts as a whole.
R.C. 5808.11 ↗ Enforcement and defense of claims: A trustee takes reasonable steps to enforce the claims of the trust and to defend claims against it.
R.C. 5808.12 ↗ Collection of trust property - successor trustees: A trustee takes reasonable steps to collect trust property held by third persons; a successor trustee's responsibility for a prior trustee's administration is governed by section 5815.24.
R.C. 5808.13 ↗ Keeping beneficiaries informed - requests - required reports: A trustee keeps the current beneficiaries reasonably informed about the administration and the material facts necessary to protect their interests, and, unless unreasonable under the circumstances, promptly responds to a beneficiary's request for information related to the administration. On a beneficiary's request the trustee promptly furnishes a copy of the trust instrument — a redacted copy limited to the provisions the trustee determines relevant to the beneficiary's interest unless the beneficiary expressly asks for the whole, and the restated instrument where the settlor completely restated the terms. Within sixty days after accepting a trusteeship, the trustee notifies the current 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 knowledge that a formerly revocable trust has become irrevocable by the settlor's death or otherwise, the trustee notifies the current beneficiaries of the trust's existence, the identity of the settlor or settlors, the right to request a copy of the instrument and the right to a trustee's report; and the trustee notifies the current beneficiaries in advance of any change in the method or rate of compensation. At least annually and at the termination of the trust the trustee sends the current beneficiaries, and other beneficiaries who request it, a report of the trust property, liabilities, receipts and disbursements, including the source and amount of the trustee's compensation, a listing of the assets and, if feasible, their market values; on a vacancy, unless a cotrustee remains, the former trustee (or a personal representative or guardian for a deceased or incapacitated trustee) sends a report for the period served. A beneficiary may waive the report or other information and may withdraw the waiver as to the future; the trustee may inform beneficiaries it is not required to inform. The two sixty-day notices apply only to acceptances, irrevocable trusts created, and revocable trusts becoming irrevocable on or after January 1, 2007; during the lifetime of the settlor of a revocable trust, whether or not the settlor has capacity, the duties under the section are owed exclusively to the settlor.
R.C. 5808.14 ↗ Judicial standard of review for discretionary trusts: A trustee exercises a discretionary power reasonably, in good faith and in accordance with the terms and purposes of the trust and the interests of the beneficiaries — the broader the settlor's grant of discretion, the broader the permissible conduct — except that no reasonableness standard applies to the distribution decisions of the trustee of a wholly discretionary trust. Unless the terms expressly say otherwise, a beneficiary-trustee other than the settlor may exercise a power to distribute for the trustee's personal benefit only under an ascertainable standard, and no trustee may distribute to satisfy a support obligation the trustee personally owes; a majority of the other trustees may exercise such a limited power, or the court may appoint a special fiduciary. Those limits do not apply to a spouse-trustee of a marital-deduction trust, to a trust while its settlor may revoke or amend it, or to a trust qualifying for the annual exclusion under section 2503(c). A trustee acting reasonably and in good faith in distributing to a second trust under section 5808.18 is presumed to have acted in accordance with the terms and purposes.
R.C. 5808.15 ↗ General powers of trustee: Without court authorization, a trustee may exercise the powers the terms of the trust confer and, except as the terms limit them, all powers over the trust property that an unmarried competent owner has over individually owned property, any other powers appropriate to achieve the proper investment, management and distribution of the trust property, and any other powers the Ohio Trust Code confers; the exercise of a power is subject to the fiduciary duties of Chapter 5808.
R.C. 5808.16 ↗ Specific powers of trustee: Lists the trustee's specific powers, without limiting section 5808.15: to collect property and accept or reject additions; acquire or sell property, for cash or on credit, at public or private sale; exchange, partition or change the character of property; deposit money in a regulated financial-service institution; borrow and mortgage or pledge; continue a business and act as its owners may; exercise an absolute owner's rights over securities, including voting, nominee holding and deposits; build, repair, improve, subdivide, dedicate and plat real property; lease, including for natural resources, beyond the trust's duration; grant and acquire options; insure the property and the trustee, agents and beneficiaries; abandon valueless property; inspect, remediate, decline and compromise as to environmental liability; pay or contest claims and settle or release them; pay taxes, assessments, compensation and expenses; make tax elections; select payment modes under benefit plans, annuities and insurance payable to the trustee; make loans, including to a beneficiary, with a lien on future distributions; guarantee loans to a revocable trust's settlor; appoint a trustee for property in another jurisdiction; pay a beneficiary under a legal disability or reasonably believed incapacitated directly, to a guardian, to a custodian, to a relative or custodian, or as a separate fund; distribute in divided or undivided interests and allocate assets, valuing them and adjusting; resolve disputes by mediation or arbitration; prosecute or defend actions; sign and deliver instruments; wind up and distribute on termination; and employ agents, attorneys, accountants, investment advisors and other professionals.
R.C. 5808.17 ↗ Powers and duties of trustee on termination; protection from liability: On a termination or partial termination, the trustee may send the beneficiaries a proposal for distribution; 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, where the proposal stated the right to object and the time allowed. On the terminating event the trustee proceeds expeditiously to distribute the trust property to the persons entitled to it, subject to retaining a reasonable reserve for debts, expenses and taxes. A beneficiary's release of the trustee is invalid to the extent induced by improper conduct or given without knowledge of the beneficiary's rights or the material facts. Where a beneficiary entitled to a distribution has died and the right survived, the trustee distributes to the personal representative of an open estate; where no administration is open and the trustee knows of no adverse claim, the trustee may without liability distribute directly to the heirs or devisees as the section's branches provide — following a completed intestate or testate administration, or, at least six months after the death, to the trustee of the beneficiary's own living trust under a pour-over will the trustee reasonably determines would have been admitted, or to the heirs the trustee reasonably determines under the law of the domicile and the situs where no administration was commenced and no will is known. The trustee's protection does not affect third parties' claims against the recipients.
R.C. 5808.18 ↗ Trustee's power to make distributions in further trust: Unless the trust instrument expressly provides otherwise, a trustee with absolute power under the first trust to distribute principal to one or more current beneficiaries may distribute all or part of the principal, and income not currently required to be distributed, to the trustee of a second trust for the benefit of one or more of those current beneficiaries, at any time and whether or not a distribution would otherwise have been made; a power not limited by reasonably definite or ascertainable standards — including one for best interests, welfare, comfort or happiness — is absolute, and the second trust may grant a power of appointment or provide that the property later returns to terms substantially identical to the first trust's. A trustee with a power that is not absolute may distribute to a second trust only where the second instrument does not materially change the beneficiaries' interests. Neither exercise may reduce a beneficiary's current right to a mandatory distribution, a mandatory annuity or unitrust interest, or an annual withdrawal right; defeat a marital, charitable, annual-exclusion, S-corporation, generation-skipping, minimum-distribution or other tax benefit the first trust qualified for; increase or change the method of the trustee's compensation without the current beneficiaries' consent or the court's approval; or reduce the standard of care or exonerate a trustee for bad faith. The exercise is by a signed writing filed with the first trust's records, is subject to the rule against perpetuities as a nongeneral power of appointment, and requires written notice to all current beneficiaries of the first trust at least thirty days before the distribution unless all of them waive the period — which does not limit a beneficiary's right to object under other provisions of the code. A person holding a fiduciary power to direct the trustee's distributions may direct a distribution under the section; a spendthrift clause or a prohibition on amendment does not bar it; a trustee acting reasonably and in good faith is presumed to have acted in accordance with the terms and purposes; and the section applies to trusts and powers as it states.
R.C. 5808.19 ↗ Anti-lapse provisions; survivorship with respect to future interests; substitute gifts: For a trust that became irrevocable on or after March 22, 2012, unless a contrary intent appears, a future interest under the terms of a trust is contingent on the beneficiary surviving the distribution date by at least one hundred twenty hours; where a beneficiary who is a grandparent, a descendant of a grandparent or a stepchild of the transferor does not, a substitute gift passes to the beneficiary's surviving descendants per stirpes — the shares determined as under division (A) of section 2105.06 — for a gift to an individual, and for a class gift (other than a multigenerational class such as "descendants" or "heirs") the deceased member's share passes to that member's surviving descendants per stirpes. Describing a class as "surviving" or "living" without saying when is not enough to negate the substitute gift; words of survivorship tied to a time are. Where no taker survives, the property passes under the donor's gift-in-default clause, then the will's or the revocable trust's residuary clause as the section provides, and then to the transferor's intestate successors as if the transferor had died on the distribution date.

Chapter 5809: Ohio Uniform Prudent Investor Act

R.C. 5809.01 ↗ Trustee duty to comply with act: The Ohio Uniform Prudent Investor Act — sections 5809.01 to 5809.08, 5808.03, 5808.05 and 5808.06, division (A) of section 5808.02 and division (B) of section 5808.07 — applies to a trustee under any testamentary, inter vivos or other trust, who owes the beneficiaries a duty to comply with it when investing and managing trust assets; the trust instrument may expand, restrict, eliminate or otherwise alter it without naming it, and a trustee is not liable to a beneficiary to the extent the trustee acted in reasonable reliance on the trust's provisions.
R.C. 5809.02 ↗ Standard of care - portfolio strategy - risk and return objectives: A trustee invests and manages trust assets as a prudent investor would, considering the purposes, terms, distribution requirements and other circumstances of the trust, with reasonable care, skill and caution, and makes a reasonable effort to verify the relevant facts. Decisions on individual assets are judged in the context of the portfolio as a whole and an overall strategy with risk and return objectives reasonably suited to the trust, considering, as relevant, 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, regularity of income and preservation or appreciation of capital, and an asset's special relationship or value to the trust's purposes or a beneficiary.
R.C. 5809.03 ↗ Investment authority - diversification: A trustee may invest in any kind of property or type of investment consistent with the Ohio Uniform Prudent Investor Act, and diversifies the trust's investments unless the trustee reasonably determines that, because of special circumstances, the purposes of the trust are better served without diversifying.
R.C. 5809.031 ↗ Duties of a trustee with respect to the acquisition, retention, or ownership of a life insurance policy: Unless the terms of the trust provide otherwise, a trustee's duties as to the acquisition, retention or ownership of a life insurance policy as a trust asset do not include determining whether the policy is or remains a proper investment, diversifying it, exercising or not exercising any option under it (including paying premiums unless cash or other readily marketable or designated assets are available), investigating the insurer's financial strength, or inquiring into the insured's health or finances; absent fraud, the trustee, the drafting attorney and anyone consulted on the trust's creation are not liable for a loss arising from the absence of those duties. The section applies to trusts and policies whenever established or acquired unless the terms provide otherwise.
R.C. 5809.04 ↗ 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 their retention and disposition, to bring the portfolio into compliance with the purposes, terms, distribution requirements and other circumstances of the trust and with the Ohio Uniform Prudent Investor Act.
R.C. 5809.05 ↗ Reviewing compliance: Compliance with the Ohio Uniform Prudent Investor Act is determined in light of the facts and circumstances existing at the time of the trustee's decision or action, not by hindsight.
R.C. 5809.06 ↗ Delegation of investment and management functions: A trustee may delegate investment and management functions that a prudent trustee of comparable skills could properly delegate, complying with division (A) of section 5808.07 in selecting the agent, setting the scope and terms and reviewing the agent's actions; the agent owes the trust a duty of reasonable care to comply with the delegation's terms and submits to Ohio's jurisdiction by accepting it; a trustee who delegates in compliance is not liable for the agent's decisions or actions.
R.C. 5809.07 ↗ Language invoking standard of act: Terms of a trust such as "investments permissible by law for investment of trust funds," "legal investments," "authorized investments," the prudent-person formula of judgment and care under the circumstances then prevailing, "prudent man rule," "prudent trustee rule," "prudent person rule" and "prudent investor rule," unless otherwise limited or modified, authorize any investment or strategy the Ohio Uniform Prudent Investor Act permits.
R.C. 5809.08 ↗ Application and construction: The Ohio Uniform Prudent Investor Act is applied and construed to promote uniformity among the states enacting it; it applies to trusts existing on or created after March 22, 1999 — as to those then existing, only to decisions or actions after that date — and the temporary investment of cash under section 5815.26 or 2109.372 is a prudent investment in compliance with it.

Chapter 5810: Breach of Trust

R.C. 5810.01 ↗ Breach of trust defined - judicial remedies: A trustee's violation of a duty owed to a beneficiary is a breach of trust. To remedy a breach 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 accounting, appoint a special fiduciary to take possession and administer, suspend the trustee, remove the trustee under section 5807.06, reduce or deny compensation, void an act, impose a lien or constructive trust or trace and recover property wrongfully disposed of (subject to section 5810.12), or order any other appropriate relief.
R.C. 5810.02 ↗ Liability to beneficiaries for breach - contribution: A trustee who commits a breach of trust is liable to the affected beneficiaries for the greater of the amount required to restore the trust property and distributions to what they would have been without the breach and the profit the trustee made by reason of the breach. Where more than one trustee is liable, a trustee is entitled to contribution from the others, except a trustee substantially more at fault, one who acted in bad faith or with reckless indifference, or, to the extent of a benefit received, one who benefited from the breach.
R.C. 5810.03 ↗ Trustee not accountable or liable for profit or loss absent breach: Absent a breach of trust, a trustee is not accountable to a beneficiary for a profit made from the administration and is not liable to a beneficiary for a loss or depreciation in the value of trust property or for not having made a profit.
R.C. 5810.04 ↗ Award of costs, expenses, and attorney fees from trust: In a judicial proceeding involving the administration of a trust, including one with a spendthrift provision, the court, as justice and equity may require, may award costs, expenses and reasonable attorney's fees to any party, payable by another party, from the trust, or from a party's interest in it.
R.C. 5810.05 ↗ Limitations period for action against trustee: A beneficiary may not commence a proceeding against a trustee for breach of trust more than two years after the date the beneficiary, the beneficiary's representative or a beneficiary surrogate is sent a report that adequately discloses the existence of a potential claim for breach of trust and informs the recipient of the time allowed for commencing a proceeding; a report adequately discloses a potential claim if it provides enough information that the beneficiary or representative knows, or should know, of it. Where that rule does not apply, and notwithstanding section 2305.09, the proceeding is commenced within four years after the first of the trustee's removal, resignation or death, the termination of the beneficiary's interest, the termination of the trust, or the time the beneficiary knew or should have known of the breach. Laches, unclean hands, estoppel, waiver and other principles of law and equity that can bar claims are unaffected.
R.C. 5810.06 ↗ Trustee reliance on terms of trust: A trustee who acts in reasonable reliance on the terms of the trust as expressed in the trust instrument is not liable to a beneficiary for a breach of trust to the extent the breach resulted from the reliance.
R.C. 5810.07 ↗ Reasonable care to ascertain material event: Where an event — a marriage, a divorce, the performance of educational requirements, a death — affects the administration or distribution of a trust, a trustee who exercised reasonable care to ascertain its happening is not liable for a loss resulting from the trustee's lack of knowledge.
R.C. 5810.08 ↗ Enforceability of exculpatory trust term: A term relieving a trustee of liability for breach of trust is unenforceable to the extent it relieves the trustee of liability for a breach committed in bad faith or with reckless indifference to the purposes of the trust or the interests of the beneficiaries, or was inserted through the trustee's abuse of a fiduciary or confidential relationship with the settlor.
R.C. 5810.09 ↗ Beneficiary or representative's consent to conduct constituting breach: A trustee is not liable to a beneficiary for a breach of trust where the beneficiary, or the beneficiary's representative under Chapter 5803., consented to the conduct, released the trustee or ratified the transaction — unless the consent, release or ratification was induced by the trustee's improper conduct or given without knowledge of the beneficiary's rights or the material facts — whether or not the conduct was one or more breaches of fiduciary duty, violated the Revised Code or lacked required court approval.
R.C. 5810.10 ↗ Personal contract and tort 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 that capacity — "trustee," "as trustee," "fiduciary" or similar words after the name or signature suffice — and is personally liable for torts committed in administering the trust, or for obligations arising from ownership or control of trust property, including environmental liability, only if personally at fault; such a claim may be asserted against the trustee in the fiduciary capacity whether or not the trustee is personally liable.
R.C. 5810.11 ↗ Personal liability of trustee on contract as partner: A trustee holding a general partnership interest is not personally liable on partnership contracts entered into after the trust acquired the interest where the fiduciary capacity was disclosed — by a filed partnership certificate using "as trustee" or similar words, by a county-recorded certificate the section describes, or by a contract or instrument delivered to the other party — and is not personally liable for the partnership's torts or obligations of ownership unless personally at fault; the immunity does not apply to an interest held in another capacity or by the trustee's spouse, descendants, siblings or parents or their spouses; the settlor of a revocable trust is personally liable for the partnership's obligations as if a general partner; a trust named as partner means its current trustees and their successors.
R.C. 5810.12 ↗ Person assisting or dealing with trustee in good faith: A person other than a beneficiary who in good faith assists a trustee, or in good faith and for value deals with a trustee, 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, need not ensure the proper application of assets delivered to the trustee, and is protected in dealing with a former trustee without knowledge that the trusteeship ended; comparable protections of commercial and securities law prevail over the section.
R.C. 5810.13 ↗ Certification of trust furnished to person not beneficiary: 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 powers of the trustee, the trust's revocability or irrevocability and the identity of anyone holding a power to revoke, and the authority of cotrustees to sign and whether all or fewer than all are required to exercise the trustee's powers. Any trustee may sign or otherwise authenticate it; it states 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; it may establish the identity of the trustee and any succession under section 5810.14; the recipient may require copies of the excerpts of the instrument and amendments that designate the trustee and confer the power to act in the pending transaction. A person relying on it without knowledge that its representations are incorrect is not liable and may assume the facts it states — knowledge of the terms is not inferred from holding a copy of the instrument — and a person who in good faith transacts in reliance on it may enforce the transaction against the trust property as if its representations were correct. The section does not affect a memorandum of trust under section 5301.255 or the right to obtain the instrument in a judicial proceeding.
R.C. 5810.14 ↗ Transfer of personal property to trustee: Personal property is transferred to a trustee by a written instrument that identifies the property and names the trustee followed by "trustee"; a future transfer to a trustee as a designated beneficiary — a transfer-on-death or payable-on-death designation, a joint ownership arrangement or another contractual arrangement — made that way is a transfer to the trustee serving at the time of the transfer, and an instrument naming the trust without the trustee is likewise a transfer to the then-serving trustee; a certification of trust may establish the trustee's identity and any succession. The instrument may add the trust's name, the settlor, the creation date and the amendment dates, and the section does not affect sections 5301.03 or 5301.071(E) on real property.

Chapter 5811: Application and Construction of Code

R.C. 5811.01 ↗ Promotion of uniformity of law: In applying and construing the Ohio Trust Code, a court may consider the need to promote uniformity of the law on its subject among the states that enact the uniform trust code.
R.C. 5811.02 ↗ Electronic Signatures in Global and National Commerce Act: The Ohio Trust Code's provisions on the legal effect, validity or enforceability of electronic records and signatures, and of contracts formed or performed with them, conform to section 102 of the federal Electronic Signatures in Global and National Commerce Act and supersede, modify and limit its requirements.
R.C. 5811.03 ↗ Temporal application of provisions of Code: Except as the code otherwise provides, the Ohio Trust Code applies to all trusts created before, on or after its effective date and to all judicial proceedings commenced on or after it — and to earlier proceedings unless the court finds a provision would substantially interfere with the proceeding or prejudice the parties — its rules of construction and presumptions apply to instruments executed before that date absent a clear contrary intent, it does not affect an act done before that date, and a period that had commenced to run under another statute continues under that statute.

Chapter 5815: Miscellaneous Provisions

R.C. 5815.24 ↗ Limitations on liability: A fiduciary or custodian who receives real or personal property from another fiduciary is not required to inquire into any act, or audit any account, of the transferor fiduciary unless the governing instrument specifically directs it or the transferee has actual knowledge of conduct that would be a breach of the transferor's fiduciary responsibilities. A trustee authorized or directed to pay or advance trust property to a decedent's personal representative for the decedent's obligations, death taxes, bequests or expenses of administration is not liable for its application or for the representative's acts unless the trustee knew beforehand that the representative did not intend to use it for those purposes; and a trustee may pay a beneficiary's expenses as the instrument permits, even if the payments exhaust the trust, without liability to the beneficiary's creditors.
R.C. 5815.25 ↗ Administrative duties and responsibilities of trust; exclusion of fiduciaries: Where an instrument or written agreement appoints a fiduciary to handle only the administrative duties of a trust — opening and maintaining accounts, keeping records and correspondence, maintaining an office, filing tax returns, employing agents, holding custody of property and similar duties — that administrative fiduciary has no other duties or liabilities to the beneficiaries. Where an instrument reserves to the grantor, or vests in an advisory or investment committee or another person, to the exclusion of a fiduciary, a power such as directing the acquisition, disposition or retention of investments or authorizing acts the excluded fiduciary proposes, the excluded fiduciary is not liable for a loss from compliance with an authorized direction or from a failure to act where it timely sought but did not obtain the required authorization, and is relieved of investment reviews and recommendations to that extent. The section yields to inconsistent provisions of the instrument.

Chapter 5816: Ohio Legacy Trust Act

R.C. 5816.02 ↗ Definitions: Defines the terms of the Ohio Legacy Trust Act — among them a "legacy trust": a trust evidenced by a written instrument that has or names at least one qualified trustee for the property that is the subject of a qualified disposition, expressly incorporates Ohio law to govern its validity, construction and administration in whole or in part, expressly states that it is irrevocable, and has a spendthrift provision applicable to every beneficiary's interest including the transferor's; a "qualified trustee" (a person other than the transferor who is an Ohio resident, or an Ohio-authorized and supervised institution or a qualifying family trust company, and who maintains custody of some of the property or the trust's records in Ohio, prepares or arranges its tax returns, or otherwise materially participates in its administration); a "qualified disposition" (a disposition by or from a transferor to any trustee of a legacy trust); "advisor"; "asset" (excluding property encumbered by a valid lien, exempt property under section 2329.66 and similar laws, and entireties property); "claim"; "creditor"; and "qualified affidavit."
R.C. 5816.07 ↗ Restrictions on actions, remedies, and claims: Subject to section 5816.10, no creditor may bring an action of any kind — to enforce a judgment, at law or in equity, or for attachment or another provisional or final remedy — against a person who made or received a qualified disposition, against property that is the subject of one or is held in a legacy trust, or against a legacy trust's trustee, except an action to avoid a qualified disposition on the ground that the transferor made it with specific intent to defraud the specific creditor bringing the action. That action is extinguished unless brought, by a creditor whose claim predates the disposition, within the later of eighteen months after the disposition or six months after the creditor discovered or reasonably could have discovered it (where the creditor sued or made written demand on the transferor within three years of the disposition), or, by a later creditor, within eighteen months after the disposition; the creditor's burden is clear and convincing evidence. A creditor has only the rights the section and section 5816.08 provide, and none against a trustee, an advisor or anyone involved in counseling, drafting, preparing, executing, administering or funding the legacy trust; each qualified disposition is evaluated separately, with payments deemed made from the money and fungible assets most recently received.

Chapter 5817: Determination of Validity of Trust or Will During Lifetime

R.C. 5817.02 ↗ Action by testator: A testator may file a complaint with the probate court to determine, before the testator's death, that the testator's will is valid subject only to later revocation or modification — a right personal to the testator that a guardian or an agent may not exercise; a testator seeking that determination files for the will and any related trust together; not filing is not evidence that the will is invalid; and the complaint is accompanied by an express written waiver of the testator's physician-patient privilege under section 2317.02(B).
R.C. 5817.10 ↗ Declaration of validity: On a testator's or settlor's complaint, the court declares a will valid on finding that it was properly executed under section 2107.03 or the prior law in force at execution, that the testator had testamentary capacity and was free from undue influence, restraint and duress, and that the execution was not the result of fraud or mistake — after which, unless modified or revoked, the will has full legal effect and is admitted to probate on request; and declares a trust valid on finding that it meets section 5804.02, that the settlor had capacity and was free from undue influence, restraint and duress, and that its execution was not the result of fraud or mistake — after which, unless modified or revoked, the trust has full legal effect. The court may attach a copy of the valid document to its judgment entry.

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