§ 30-4-5-14.5 — Nonjudicial settlement; procedures

Indiana § 30-4-5-14.5

• Jurisdiction: Indiana
• Art. 4: TRUST CODE
• Ch. 5: Rules Governing the Administration of a Trust

Text

5. (a) A trustee may obtain a nonjudicial
settlement of its accounts in accordance with subsection (b) when:
(1) a trust terminates pursuant to the terms of the trust;
(2) a trust terminates early pursuant to IC 30-4-3-24.5;
(3) a trustee resigns or is removed; or
(4) a trustee seeks discharge of an interim accounting period when
the trust is continuing.
(b) A trustee who elects to proceed under this section shall provide
the following to the qualified beneficiaries of the trust and a successor
trustee, if applicable, within a reasonable time after termination of the
trust pursuant to its terms, the resignation or removal of the trustee, or
the end of the period for which the trustee is seeking discharge:
(1) A statement showing the fair market value of the net assets to
be distributed from a terminating trust or to a successor trustee.
(2) A trust accounting for the prior three (3) years showing all
receipts and disbursements and inventory value of the net assets.
(3) An estimate for any items reasonably anticipated to be
received or disbursed.
(4) The amount of any fees, including trustee fees, remaining to
be paid.
(5) Notice that the trust is terminating, or that the trustee has
resigned or been removed, the time period for which the trustee
seeks discharge of its accounts, and a statement providing that
claims against a trustee under IC 30-4-6-12 and IC 30-4-6-14, if
applicable, shall be barred if no objections are received within the
time period described in subsection (c).
(6) The name and mailing address of the trustee.
(7) The name and telephone number of a person who may be
contacted for additional information.
The trustee may also provide the statement and notice described in this
subsection to any other person who the trustee reasonably believes may
have an interest in the trust.
(c) If, after receiving the notice and trust information described in
subsection (b), a qualified beneficiary objects to a disclosed act or
omission, the qualified beneficiary shall provide written notice of the
objection to the trustee not later than sixty (60) days after the notice
was sent by the trustee. If no written objection is provided in the sixty
(60) day time period, the information provided under subsection (b)
shall be considered approved by the recipient. The trustee shall, in the
case of a trust terminating pursuant to the terms of the trust or the
trustee's resignation or removal, within a reasonable period of time
following the expiration of the sixty (60) day time period, distribute the
assets as provided in the trust or to the successor trustee. If a qualified
beneficiary gives the trustee a written objection within the applicable
sixty (60) day time period, the trustee or the qualified beneficiary may:
(1) submit the written objection to the court for resolution and
charge the expense of commencing a proceeding to the trust; or
(2) resolve the objection by a nonjudicial settlement agreement
under section 25 of this chapter, or otherwise.
Any agreement entered into pursuant to subdivision (2) may include a
release, an indemnity clause, or both, on the part of the beneficiary
against the trustee relating to the trust. If the parties agree to a
nonjudicial settlement agreement under section 25 of this chapter, any
related expenses shall be charged to the trust. Upon a resolution of an
objection under this subsection, within a reasonable period of time, the
trustee shall distribute the remaining trust assets as provided in the trust
or to the successor trustee.
(d) The trustee may rely upon the written statement of a person
receiving notice that the person does not object.
(e) When a trustee distributes assets of a terminating trust or to a
successor trustee after complying with the provisions of this article and
having received no objections, each person who received notice and
either consented or failed to object pursuant to this section is barred
from:
(1) bringing a claim against the trustee or challenging the validity
of the trust to the same extent and with the same preclusive effect
as if the court had entered a final order approving the trustee's
final account; or
(2) bringing a claim against the trustee for the period of such
interim accounts to the same extent and with the same preclusive
effect as if the court had entered a final order approving the
trustee's interim accounts.
(f) A trustee may not request that a beneficiary indemnify the trustee
against loss in exchange for the trustee forgoing a request to the court
to approve its accounts at the time that the trust terminates, or at the
time the trustee resigns or is removed, except as agreed upon by the
parties pursuant to subsection (c).
(g) The court that exercises probate jurisdiction shall have exclusive
jurisdiction over matters under this section.
(h) IC 30-4-6-10.5 shall apply to this section.
(i) Nothing in this section shall preclude a trustee from proceeding
under IC 30-4-3-18(b) to have the trustee's accounts reviewed and
settled by the court.

Legislative History

As added by P.L.221-2019, SEC.6. Amended by P.L.231-2019, SEC.27; P.L.56-2020, SEC.11.