Recently (April 2012), the Oklahoma Governor signed a new law, effective November 1, 2012, amending the Oklahoma Trust Act authorizing the creator of a Trust to appoint a "Trustee Advisor." This brief statutory amendment reads as follows:
"Trustee advisor" means a person appointed by the terms of the trust
instrument to act as an advisor to the trustee with regard to all or some of the
matters relating to the property of the trust. Unless otherwise provided by the
terms of the trust instrument, if a trustee advisor is appointed, the property
and management of the trust and the exercise of all powers and discretionary
acts exercisable by the trustee remain vested in the trustee as fully and
effectively as if an advisor were not appointed, the trustee is not required to
follow the advice of the trustee advisor, and the trustee advisor is not liable
as or considered to be a trustee of the trust or a fiduciary when acting as an
advisor to the trust.
Unlike some sister states' laws authorizing the use of a Trustee Advisor which set forth very specific powers which can be granted in the trust document to the Trustee Advisor, our new statute grants no specific powers to a Trustee Advisor. Instead, the Trustee Advisor is truly an "advisor" only to the Trustee, and the Trustee is not required to follow the advice of the Trustee Advisor. The statute does state, however, that this outcome (i.e., the Trustee Advisor is truly only an advisor not a director to the Trustee and, thus, the Trustee Advisor cannot direct the Trustee to take certain actions) can be modified by the written terms of the trust document. This means that apparently there is a right that the person creating the trust may appoint someone (i.e., the Trustee Advisor) who is not the Trustee and grant that person power to direct the Trustee in certain areas of management of the trust. Some of these areas may include investments; amount and frequency of distributions to a beneficiary; modification of, or even amendment to, the trust. In a future post, I will address some of the pros and cons of naming a Trustee Advisor in a trust document.
Curtis J. Shacklett
Barber & Bartz
525 S. Main Street, Suite 800
Tulsa, Oklahoma 74103-4511
Telephone: (918) 599-7755
Facsimile: (918) 599-7756
E-mail: cshacklett@barberbartz.com
