MONTANA UNIFORM PRUDENT INVESTOR ACT

MONTANA UNIFORM PRUDENT INVESTOR ACT

 

Montana Code Annotated 2019
TITLE 72. ESTATES, TRUSTS, AND FIDUCIARY RELATIONSHIPS
CHAPTER 38. MONTANA UNIFORM TRUST CODE
Part 9. Uniform Prudent Investor Act


72-38-901. Prudent investor rule. (1) Except as provided in subsection (2), a trustee who invests and manages trust assets owes a duty to the beneficiaries of the trust to comply with the prudent investor rule.
(2) The settlor may expand or restrict the prudent investor rule by express provisions in the trust instrument. A trustee is not liable to a beneficiary for the trustee's good faith reliance on these express provisions.
History: En. Sec. 112, Ch. 264, L. 2013.

72-38-902. Standard of care — investments and management — considerations. (1) A trustee shall invest and manage trust assets as a prudent investor would, by considering the purposes, terms, distribution requirements, and other circumstances of the trust. In satisfying this standard, the trustee shall exercise reasonable care, skill, and caution.
(2) A trustee’s investment and management decisions respecting individual assets and courses of action must be evaluated not in isolation, but in the context of the trust portfolio as a whole and as a part of an overall investment strategy having risk and return objectives reasonably suited to the trust.
(3) Among circumstances that are appropriate to consider in investing and managing trust assets are the following, to the extent relevant to the trust or its beneficiaries:
(a) general economic conditions;
(b) the possible effect of inflation or deflation;
(c) the expected tax consequences of investment decisions or strategies;
(d) the role that each investment or course of action plays within the overall trust portfolio;
(e) the expected total return from income and the appreciation of capital;
(f) other resources of the beneficiaries known to the trustee as determined from information provided by the beneficiaries;
(g) needs for liquidity, regularity of income, and preservation or appreciation of capital; and
(h) an asset’s special relationship or special value, if any, to the purposes of the trust or to one or more of the beneficiaries.
(4) A trustee shall make a reasonable effort to ascertain facts relevant to the investment and management of trust assets.
(5) A trustee may invest in any kind of property or type of investment or engage in any course of action or investment strategy consistent with the standards of this Act.
History: En. Sec. 113, Ch. 264, L. 2013.

72-38-903. Diversification — duty of trustee — exception. (1) Subject to subsection (2), in making and implementing investment decisions, the trustee has a duty to diversify the investments of the trust unless, under the circumstances, it is not prudent to do so.
(2) If trust assets include farm or ranch property, a closely held family business, timber interests, or interests in oil, gas, or minerals, the trustee may elect to retain those assets. A trustee’s exercise of discretion to retain assets of the character described in this subsection is not a breach of the trustee’s duty to diversify investments.
History: En. Sec. 114, Ch. 264, L. 2013.

72-38-904. Review of assets — time for compliance. Within a reasonable time after accepting a trusteeship or receiving trust assets, a trustee shall review the trust assets and make and implement decisions concerning the retention and disposition of assets in order to bring the trust portfolio into compliance with the purposes, terms, distribution requirements, and other circumstances of the trust and with the requirements of this part.
History: En. Sec. 115, Ch. 264, L. 2013.

72-38-905. Compliance determinations — standards. Compliance with the prudent investor rule is determined in light of the facts and circumstances existing at the time of a trustee’s decision or action and not by hindsight.
History: En. Sec. 116, Ch. 264, L. 2013.

72-38-906. Interpretation of trust terms construing legal investments. The following terms or comparable language in the provisions of a trust, unless otherwise limited or modified, must be construed as authorizing any investment or strategy permitted under this part: “investments permissible by law for investment of trust funds”, “legal investments”, “authorized investments”, “using the judgment and care under the circumstances then prevailing that persons of prudence, discretion, and intelligence exercise in the management of their own affairs, not in regard to speculation but in regard to the permanent disposition of their funds, considering the probable income as well as the probable safety of their capital”, “prudent man rule”, “prudent trustee rule”, “prudent person rule”, and “prudent investor rule”.
History: En. Sec. 117, Ch. 264, L. 2013.

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