§ 2312 — Commissions of corporate trustees, including when acting as donees of powers during minority or donees of power in trust 1

New York § 2312

• Jurisdiction: New York
• Law SCP: Surrogate's Court Procedure
• Art. 23: Costs, Allowances and Commissions

Text

§ 2312. Commissions of corporate trustees, including when acting as\n donees of powers during minority or donees of power in trust\n 1. If the will or lifetime trust instrument makes provisions for\nspecific rates or amounts of commissions (other than a general reference\nto commissions allowed by law or words of like import) for a corporate\ntrustee, or, if a corporate trustee has agreed to accept specific rates\nor amounts of commissions, a corporate trustee, whether as trustee or as\ndonee of a power in trust, including for purposes of this section as\ndonee of a power during minority, created under the provisions of the\nwill or lifetime trust instrument, shall be entitled to be compensated\nin accordance with such provisions or agreement, as the case may be.\n 2. For trusts having a principal value of more than four hundred\nthousand dollars and as donee of a power in trust where the property\nsubject to the power, including for purposes of this section the\nproperty subject to a power during minority, has a principal value of\nmore than four hundred thousand dollars and subject to the provisions of\nsubdivision 4 of this section, if the will or lifetime trust instrument\ndoes not make provisions for specific rates or amounts of commissions,\nor, contains only a general reference to commissions allowed by law or\nwords of like import, a corporate trustee shall be entitled to such\ncommissions as may be reasonable, and the court, upon application of a\nperson interested in the trust or in the fund held by the corporate\ntrustee as donee of a power in trust, may review the reasonableness of\nthe commission of such corporate trustee.\n 3. Subject to the provisions of paragraph (a) of subdivision 4 of this\nsection and regardless of the principal value of the trust: (a) during\nthe continuance of a trust created solely for public, religious,\ncharitable, scientific, literary, educational or fraternal uses and\nduring the period of continuance of such a trust established after the\ntermination of a life use or uses a corporate trustee, except as\nprovided in paragraph (b) of this subdivision, shall be entitled to and\nmay retain annual commissions in accordance with the provisions of\nsubdivision 1 or 2 of this section, as the case may be.\n (b) In the case of a trust created solely for public, religious,\ncharitable, scientific, literary, educational or fraternal uses a\ncorporate trustee shall not be entitled to any commission for paying out\nprincipal.\n (c) In the case of such a trust which continues after the termination\nof the measuring life use or uses a corporate trustee for the period of\nthe measuring life use or uses shall be entitled to commissions from\nincome and principal according to the provisions of subdivision 1 or 2\nhereof, as the case may be, and except in respect of principal paid out\nto a charity or for charitable uses shall be entitled to a commission\nfor distributing all sums of principal in accordance with the provisions\nof subdivision 1 or 2 hereof, as the case may be.\n 4. Notwithstanding anything contained in this chapter, the estates,\npowers and trusts law or any other provision of law to the contrary,\n (a) Except as otherwise provided by paragraph (b) of this subdivision\nand subdivision three of this section, a corporate trustee of any trust\ncreated under will or lifetime trust instrument, or as donee of a power\nin trust created under will or lifetime instrument, whether in existence\non or after the effective date of this section, shall be entitled to\nreceive at least the compensation provided for an individual trustee\nunder subdivisions 1, 2, 5 (but only as trustee), 6, 7 and 12 of section\n2308 and subdivisions 1, 2, 5 (but only as trustee), 6, 7 and 8 of\nsection 2309, as the case may be, in effect after the effective date of\nthis section, at the time and in the manner provided by such sections,\nunless the will or lifetime trust instrument or an agreement between the\ntrustee and the testator or grantor or by the trustee shall provide\notherwise.\n (b) A corporate trustee shall, in addition to the compensation\npermitted by the provisions of paragraph (a) of this subdivision, be\nentitled to annual commissions at the rate of not more than $12.35 per\nthousand or major fraction thereof, in lieu of the annual commissions\nprovided under paragraph (a) of this subdivision, on trusts having a\nprincipal value of not more than four hundred thousand dollars and shall\nbe entitled to annual commissions at the same rate as donee of a power\nin trust where the property subject to the power has a principal value\nof not more than four hundred thousand dollars, and such annual\ncommissions shall be deemed reasonable compensation, unless the will or\nlifetime trust instrument or an agreement between the corporate trustee\nand the testator or grantor or by the corporate trustee shall provide\notherwise. A corporate trustee shall be entitled to receive such\ncommissions from time to time during the trust or calendar year and\nshall otherwise be governed by the provisions of sections 2308 and 2309,\nas the case may be, in effect from time to time.\n 5. Unless the will or lifetime trust instrument expressly provides\notherwise, the commissions allowable by subdivision 1, 2 or 4 hereof, as\nthe case may be, shall be payable one-third from the income of the trust\nor from the income of the property subject to the power in trust and\ntwo-thirds from the principal of the trust or from the property subject\nto the power in trust. However, in the case of a trust whose definition\nof income is governed by section 11-2.4 of the estates, powers and\ntrusts law or a charitable remainder annuity trust or a charitable\nremainder unitrust, as defined in section six hundred sixty-four of the\nInternal Revenue Code of nineteen hundred eighty-six, as amended, such\ncommissions shall be payable from the principal of any such trust after\nallowance for the annuity or unitrust amounts and shall not be payable\nout of such annuity or unitrust amounts.\n 6. The commissions allowed by subdivision 1, 2 or 4 thereof, as the\ncase may be, may be retained, at any time or from time to time during\nthe year in which such commissions are earned, by a corporate trustee,\nprovided it furnishes annually as of a date no more than 30 days prior\nto the end of the year selected by the corporate trustee, to each\nbeneficiary currently receiving income, and to any other beneficiary\ninterested in the income and to any person interested in the principal\nof the trust who shall make a demand therefor, and, when acting as donee\nof a power in trust, to the beneficiary of the power in trust, a\nstatement showing the principal assets or assets subject to the power in\ntrust on hand on that date, and at least annually or more frequently if\nthe trustee so elects, a statement showing all his or her receipts of\nincome and principal or of property subject to the power in trust during\nthe period with respect to which the statement is rendered including the\namount of any commissions retained and the basis upon which the\ncommissions were computed. A corporate trustee shall not be deemed to\nhave waived any commissions by reason of its failure to retain them at\nthe time when it becomes entitled thereto; provided however that\ncommissions payable from income for any such year shall be allowed and\nretained only from income derived from the trust during such year and\nshall not be supplied from income on hand in respect of any other year.\nIf a beneficiary receiving income or a beneficiary of a power in trust\nof which the corporate trustee is donee does not desire to be furnished\nwith any such statements his or her advice to the trustee to that effect\nin writing shall thereafter excuse the corporate trustee from furnishing\nsuch statements to the beneficiary unless and until the beneficiary\nrequests such annual statements from the trustee. Upon enactment of, and\nsubject to subdivision 1 of this section, a corporate trustee shall\ncontinue to receive commissions in the manner provided for a trustee or\nwhen acting as donee of a power in trust in the manner provided for a\ndonee of a power in trust under sections 2308 and 2309, as the case may\nbe, in effect immediately before the effective date of this section\nuntil the end of the then current trust or calendar year, and\nthereafter, a corporate trustee may receive commissions in accordance\nwith the provisions of subdivision 2 or 4 of this section. A corporate\ntrustee shall not change from the commissions provided for by\nsubdivision 2 or 4 of this section, as the case may be, during a trust's\ncalendar or fiscal year or the calendar year in the case of a power in\ntrust but a corporate trustee may change from the commissions provided\nfor by subdivision 2 to the commissions provided for by subdivision 4 of\nthis section, or vice versa, only at the beginning of a calendar or\nfiscal year of a trust or a calendar year in the case of a power in\ntrust, as the case may be.\n 7. On the settlement of the account of any trustee or donee of a power\nin trust under a will or lifetime trust instrument, in addition to the\ncommissions provided for by this section, the court must allow to the\ncorporate trustee including a corporate trustee acting as donee of a\npower in trust the corporate trustee's reasonable and necessary expenses\nactually paid by the trustee.\n 8. The value of any property to be determined in such manner as\ndirected by the court and the increment thereof received, distributed or\ndelivered, shall be considered as money in making computation of\ncommissions. Whenever any portion of the dividends, interests, rents or\nother income payable to a trustee or donee of a power in trust is\nrequired by any law of the United States or other governmental unit to\nbe withheld by the person paying it for income tax purposes, the amount\nso withheld shall be deemed to have been collected.\n 9. A trustee who prior to September 1, 1966 shall have received the\nmaximum amount of commissions on principal permitted by subdivision 8 of\nsection 285-a of the surrogate's court act as that subdivision existed\nprior to that date, shall not be entitled to annual principal\ncommissions for the period from the date when he or she shall have\nreceived such maximum to September 1, 1966, but shall be entitled to\nreceive commissions from and after September 1, 1966 at the rates and in\nthe manner provided in section 2308 as in effect immediately before\nenactment of this section. A trustee who is entitled to annual principal\ncommissions pursuant to section 285-a of the surrogate's court act as it\nexisted prior to September 1, 1966, but has not received them, may\nreceive an amount of commissions not in excess of the amount he or she\nwould have been entitled to if he or she had taken such commissions, and\nbe entitled to receive in addition commissions from and after September\n1, 1966 at the rates and in the manner provided in section 285-a of this\nact.\n 10. A trustee who has been acting prior to July 1, 1956 shall be\nentitled to have commissions on principal and income theretofore\nreceived by him or her computed, allowed and paid under the methods and\nat the rates set forth herein, except as follows:\n (a) If prior to July 1, 1956 a trustee has been allowed or has\nretained commissions for receiving and paying out or for distributing\nany item of principal he or she shall be entitled to no further\ncommissions on the item.\n (b) If prior to July 1, 1956 a trustee has been allowed or retained\ncommissions on any item of principal received but not paid out or\ndistributed by him or her he or she shall be entitled to no further\ncommissions for receiving the item.\n (c) Any trustee who became entitled to an annual principal commission\nunder subdivision 1 (b) of section 285-a of the surrogate's court act as\nit existed prior to April 1, 1948 and who has not retained such\ncommission may retain an amount equal to one-half of such annual\nprincipal commission. A trustee who because of the provisions of\nsubdivision 2 of section 285-a of the surrogate's court act as it\nexisted prior to April 1, 1948 either was not entitled to retain an\nannual principal commission under subdivision 1 (b) thereof or was\nrequired to credit such annual principal commission against his or her\ncommission for receiving principal, may retain an amount equal to\none-half of such annual principal commission. If a trustee has been\nallowed by decree or has retained any such annual principal commission\none-half the amount thereof shall be deducted from the amount of\ncommissions to which the trustee would otherwise be entitled under the\nprovisions of subdivision 1 of surrogate's court procedure act section\n2308.\n (d) The annual principal commissions allowed by subdivision 3 of\nsurrogate's court procedure act section 2308 as it existed on September\n1, 1967 shall not be allowed by decree or retained in respect of any\ntrust year ending prior to April 1, 1948, but for any trust year ending\non or after April 1, 1948 and prior to July 1, 1956, the annual\nprincipal commission which may be allowed by decree or retained shall be\ncomputed at the rates in effect on the date such trust year ended.\n (e) If prior to July 1, 1956 a trustee has been allowed by decree or\nhas retained commissions on any item of income received and paid out by\nhim or her prior to September 1, 1943 or on any item of income received\nby him or her subsequent to September 1, 1943 he or she shall be\nentitled to no further commission on the item.\n (f) For purposes of this section, the term "donee of a power in trust"\nshall mean any such donee including a donee of a power during minority\nwho is a corporate fiduciary and the term "property subject to the power\nin trust" shall include property subject to a power during minority.\n