§ 1012 — Protection of person dealing with trustee

(a) A person other than a beneficiary or a beneficiary's representative under Article 3 acting in a representative capacity who in good faith assists a trustee, or who 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 from liability as if the trustee properly exercised the power. (b) A person other than a beneficiary or a beneficiary's representative under Article 3 acting in a representative capacity who in good faith deals with a trustee is not required to inquire into the extent of the trustee's powers or the propriety of their exercise. (c) A person, including a beneficiary, who in good faith delivers assets to a trustee need not ensure their proper application. (d) A person other than a beneficiary who in good faith assists a former trustee, or who in good faith and for value deals with a former trustee, without knowledge that the trusteeship has terminated is protected from liability as if the former trustee were still a trustee. (e) Comparable protective provisions of other laws relating to commercial transactions or transfer of securities by fiduciaries prevail over the protection provided by this Section.

Legislative History

(Source: P.A. 101-48, eff. 1-1-20 .)