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2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2146. Apportionment of receipts when right to income arises

RS 9:2146 - Apportionment of receipts when right to income arises
A. In the administration of property transferred in trust:
(1) Receipts due but not paid when the right of the first income beneficiary to receive income from the property arises shall be treated as accruing when due.
(2) Receipts in the form of periodic payments, other than receipts on account of an interest in a juridical person or from a plan subject to R.S. 9:2151.2, not due when the right of the first income beneficiary to receive income from the property arises, shall be treated as accruing from day to day.
(3) Receipts in the form of distributions on account of an interest in a juridical person that are allocated to income under R.S. 9:2149 shall be treated as accruing on the date fixed for the determination of those entitled to distribution, or, if no date is fixed, on the date of declaration of the distribution by the juridical person.
(4) All other receipts shall be treated as accruing at the time of payment.
B. Receipts treated as accruing after the right of the first income beneficiary to receive income from the property arises, are income if they otherwise are income under the provisions of this Subpart. Receipts treated as accruing at an earlier time are principal.
Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2147. Apportionment of receipts when right to income ceases

RS 9:2147 - Apportionment of receipts when right to income ceases
Upon the termination of an income interest, the income beneficiary whose interest is terminated, or his heirs, legatees, or assignees, is entitled to receive any required distributions of or from the following:
(1) Income paid to the trustee but undistributed on the date of termination.
(2) Income due but not paid to the trustee on the date of termination.
(3) Income in the form of periodic payments subject to daily accrual, other than periodic payments on account of an interest in a juridical person, not due on the date of termination but accrued prior to the date of termination.
(4) Distributions on account of an interest in a juridical person that are allocated to income under R.S. 9:2149 and that are paid after the termination of the interest if the date for determination of those entitled to distribution is a date before the termination of the interest, or, in the event no date is fixed, if the date of declaration of the distribution by the juridical person is a date before termination of the interest.
Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2148. Succession receipts and expenses

RS 9:2148 - Succession receipts and expenses
Succession receipts and expenses shall be allocated to a legacy in trust in accordance with what is reasonable and equitable in view of the interests of those entitled to income as well as of those entitled to principal.
Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2149. Receipts from interests in juridical persons

RS 9:2149 - Receipts from interests in juridical persons
A. Except as otherwise provided in this Section, a trustee shall allocate to income money received on account of an interest in a juridical person.
B. A trustee shall allocate to principal the following distributions received on account of a trustee's interest in a juridical person:
(1) Property other than money.
(2) Money received in one distribution or a series of related distributions in exchange for part or all of a trustee's interest in the juridical person.
(3) Money received in total or partial liquidation of the juridical person.
(4) Money received from a regulated investment company or a real estate investment trust if the money distributed is a capital gain dividend for federal income tax purposes.
C. Money is received in partial liquidation to the extent that the juridical person, at or near the time of a distribution, indicates that it is a distribution in partial liquidation. A partial liquidation also occurs if the total amount of money and property received in a distribution or series of related distributions is greater than twenty percent of the juridical person's gross assets, as shown by the juridical person's year-end financial statements immediately preceding the initial receipt.
D. Money is not received in partial liquidation, nor may it be taken into account under Subsection C of this Section, to the extent that it does not exceed the amount of income tax that a trustee or beneficiary must pay on taxable income of the juridical person that distributes the money.
E. Notwithstanding the provisions of this Section, if the receipt is one to which a more specific provision of this Subpart applies, a trustee may allocate the receipt based upon the source or character of the receipt and may rely upon a statement made by the juridical person regarding the source or character of the receipt.
Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2150. Obligation to pay money

RS 9:2150 - Obligation to pay money
A. An amount received as interest, whether determined at a fixed, variable, or floating rate, on an obligation to pay money to the trustee, including an amount received in return for prepaying principal, shall be allocated to income without any provision for amortization of premium.
B. A trustee shall allocate to principal an amount received from the sale, redemption, or other disposition of an obligation to pay money to the trustee more than one year after it is purchased or acquired by the trustee, including an obligation whose purchase price or value when it is acquired is less than its value at maturity. If the obligation matures within one year after it is purchased or acquired by the trustee, an amount received in excess of its purchase price or its value when acquired by the trust shall be allocated to income.
C. This Section does not apply to an obligation to which R.S. 9:2151.2, 2152, 2153, or 2154 applies.
Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2151. Sole proprietorship

RS 9:2151 - Sole proprietorship
The receipts and expenses of a sole proprietorship shall be allocated in accordance with what is reasonable and equitable in view of the interests of those entitled to income as well as of those entitled to principal.
Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2151.1. Insurance contracts

RS 9:2151.1 - Insurance contracts
A. A trustee shall allocate to principal the proceeds of a life insurance policy in which the trustee is named as beneficiary.
B. A trustee shall allocate to principal the proceeds of a contract that insures the trustee against loss for damage to, destruction of, or loss of an interest in a trust asset.
C. The trustee shall allocate dividends on an insurance policy to income if the premiums on the policy are paid from income, and to principal if the premiums are paid from principal.
D. A trustee shall allocate to income proceeds of a contract that insures the trustee against loss of occupancy or other use by an income beneficiary, loss of income, or loss of profits from a business.
Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2151.2. Deferred compensation, annuities, and similar payments

RS 9:2151.2 - Deferred compensation, annuities, and similar payments
A. Payments made in money or other property to a trustee over a period of years or during the life of an individual from an annuity, an individual retirement account, an employee-benefit plan, a pension plan, a profit-sharing plan, a deferred compensation plan, or any similar arrangement created pursuant to income-tax incentives to fund for retirement are allocated as follows:
(1) To the extent that a payment is characterized as interest, a dividend, or a payment made in lieu of interest or a dividend, a trustee shall allocate the payment to income. The trustee shall allocate to principal the balance of the payment and any other payment received in the same accounting period that is not characterized as interest, a dividend, or an equivalent payment.
(2) If no part of a payment is characterized as interest, a dividend, or an equivalent payment, and all or part of the payment is required to be made, a trustee shall allocate to income ten percent of the part that is required to be made during the accounting period and the balance to principal. If no part of a payment is required to be made or the payment received is the entire amount to which the trustee is entitled, the trustee shall allocate the entire payment to principal. To the extent that a trustee exercises a right of withdrawal, a payment is not considered to be required to be made.
B. If, in order to qualify for a marital deduction, a trustee must allocate more of a payment to income than provided for in this Section, the trustee shall allocate to income the additional amount necessary to qualify for the marital deduction.
Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2152. Proceeds of mineral interests

RS 9:2152 - Proceeds of mineral interests
A. To the extent that a trustee accounts for receipts from an interest in mineral rights or other interest in oil, gas, or other minerals pursuant to this Section, the trustee shall allocate them as follows:
(1) If received as delay rental or annual rent on a mineral lease, a receipt shall be allocated to income.
(2) If received from a production payment, a receipt shall be allocated to income if and to the extent that the agreement creating the production payment provides a factor for interest or its equivalent. The balance shall be allocated to principal.
(3) If received as a royalty, overriding royalty, shut-in payment, take-or-pay payment, or bonus, a receipt shall be allocated in accordance with what is reasonable and equitable in view of the interests of those entitled to income as well as of those entitled to principal.
(4) If an amount is received from a working interest or any other interest not provided for in this Subsection, a receipt shall be allocated in accordance with what is reasonable and equitable in view of the interests of those entitled to income as well as of those entitled to principal.
B. This Section applies whether or not a decedent or donor was extracting oil, gas, or other minerals before the interest became subject to the trust.
C. If the trust property includes an interest in mineral rights or other interest in oil, gas, or other minerals on January 1, 2021, the trustee may allocate receipts from the interest as provided in this Section or in the manner used by the trustee before January 1, 2021. If the trustee acquires an interest in mineral rights or other interest in oil, gas, or other minerals after January 1, 2021, the trustee shall allocate receipts from the interest as provided in this Section.
D. An allocation of a receipt under this Section is presumed to be reasonable and equitable if ninety percent is allocated to principal and ten percent to income. Any other allocation shall not be presumed to be unreasonable or inequitable.
E. This Section is not applicable to timber, water, soil, sod, dirt, turf, mosses, shells, gravel, or other natural resources.
Amended by Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2153. Timber

RS 9:2153 - Timber
A. If part of the principal consists of land from which timber may be removed, the receipts from taking the timber from the land shall be allocated in accordance with what is reasonable and equitable in view of the interests of those entitled to income as well as of those entitled to principal.
B. An allocation of a receipt under this Section is presumed to be reasonable and equitable if ninety percent is allocated to principal and ten percent to income. Any other allocation shall not be presumed to be unreasonable or inequitable.
Amended by Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2154. Other property subject to depletion

RS 9:2154 - Other property subject to depletion
A. Except as provided in R.S. 9:2152 and 2153, if the principal consists of property subject to depletion, the receipts shall be allocated in accordance with what is reasonable and equitable in view of the interests of those entitled to income as well as those entitled to principal.
B. An allocation of a receipt under this Section is presumed to be reasonable and equitable if ninety percent is allocated to principal and ten percent to income. Any other allocation shall not be presumed to be unreasonable or inequitable.
Amended by Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2155. Repealed by Acts 2020, No. 17, §2, eff. Jan. 1, 2021.

RS 9:2155 - Repealed by Acts 2020, No. 17, §2, eff. Jan. 1, 2021.
Acts 2020, No. 17, §2, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2156. Charges

RS 9:2156 - Charges
A. The following charges shall be made against income:
(1) Ordinary expenses incurred or accrued in connection with the administration, management, or preservation of the trust property.
(2) One-half of court costs, attorney fees, and other fees on periodic accounting, unless the court directs otherwise.
(3) Court costs, attorney fees, and other fees on other accountings or judicial proceedings if the matter primarily concerns the income interest, unless the court directs otherwise.
(4) One-half of the trustee's regular compensation, whether based on a percentage of principal or income.
(5) Expenses reasonably incurred by the trustee for the management and application of income.
(6) Interest accrued on an indebtedness.
B. If charges against income are of unusual amount, the trustee may by means of reserves or other reasonable means charge them over a reasonable period and withhold from distribution sums sufficient to produce substantial regularity in distributions.
C. The following charges shall be made against principal:
(1) Extraordinary expenses incurred or accrued in connection with the administration, management, or preservation of the trust property.
(2) Expenses incurred in making a capital improvement to principal, including special taxes and assessments.
(3) Expenses incurred in investing and reinvesting principal.
(4) One-half of court costs, attorney fees, and other fees on periodic accounting, unless the court directs otherwise.
(5) Court costs, attorney fees, and other fees on other accountings or judicial proceedings if the matter primarily concerns the principal interest, unless the court directs otherwise.
(6) Expenses incurred in maintaining or defending an action to construe the trust or to protect the trust or the trust property.
(7) One-half of the trustee's regular compensation, whether based on a percentage of principal or income.
(8) All the trustee's special compensation.
(9) The amount of an estate tax apportioned to the trust, including interest and penalties.
(10) The principal of an indebtedness.
D. If the payment of special taxes and assessments produces an addition to the value of the trust property, the trustee shall reserve out of income and add to principal a reasonable allowance for the depreciation of the improvement under generally accepted accounting principles, although the improvement was not made directly to the trust property.
E. Regularly recurring charges shall be apportioned to the same extent and in the same manner that receipts are apportioned under R.S. 9:2145 through 2147.
Acts 2010, No. 175, §2; Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2156.1. Transfers from income to principal for depreciation

RS 9:2156.1 - Transfers from income to principal for depreciation
A trustee may transfer to principal a reasonable amount of the net cash receipts from a principal asset that is subject to depreciation but may not transfer any amount for depreciation during the administration of a succession or for that portion of an immovable used or available for use by a beneficiary as a residence or of corporeal movables held or made available for the personal use or enjoyment of a beneficiary. An amount transferred to principal need not be held as a separate fund.
Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2156.2. Income taxes

RS 9:2156.2 - Income taxes
A. A tax required to be paid by a trustee based on receipts allocated to income shall be paid from income.
B. A tax required to be paid by a trustee based on receipts allocated to principal shall be paid from principal, even if the tax is denominated an income tax by the taxing authority.
C. A tax required to be paid by a trustee on the trust's share of a juridical person's taxable income shall be paid as follows:
(1) From income to the extent that receipts from the juridical person are allocated only to income.
(2) From principal to the extent that receipts from the juridical person are allocated only to principal.
(3) Proportionately from principal and income to the extent that receipts from the juridical person are allocated to both income and principal.
(4) From principal to the extent that the tax exceeds the total receipts from the juridical person.
D. After applying the provisions of this Section, the trustee shall adjust income or principal receipts to the extent that the trust's taxes are reduced because the trust receives a deduction for payments made to a beneficiary.
Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2158. Power to adjust

RS 9:2158 - Power to adjust
A. A trustee may make an adjustment between principal and income when the interest of one or more beneficiaries is defined by reference to the "income" of a trust, and the trustee determines, after taking into account the allocations for the year under Subpart D of this Part, that the adjustment is necessary in order for the trustee to satisfy his duty to be fair and reasonable to all the beneficiaries, taking into account the purposes of the trust.
B. When income is distributed during the year, the income can be determined based on the adjustment to be made for the year. The adjustment to be made for the year can be determined in a way that causes the total amount distributed to the income beneficiary during the year to be equal to a percentage of the value of the trust property at the end of the prior year or at the end of an average of up to three prior years.
C. The authority to make an adjustment under this Section is subject to the limitations set forth hereafter in this Subpart.
Acts 2001, No. 520, §4; Acts 2015, No. 219, §1.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2159. When the power to adjust is denied

RS 9:2159 - When the power to adjust is denied
A trustee shall not make an adjustment under R.S. 9:2158:
(1) If the existence or exercise of the power to adjust would cause ineligibility for the estate-tax or gift-tax marital deduction or charitable deduction.
(2) That diminishes the value for gift-tax purposes of the income interest in a trust to which a person transfers property with intent to qualify for a gift tax exclusion;
(3) If possessing or exercising the power to make an adjustment causes an individual to be treated as the owner of all or part of the trust for income tax purposes, and the individual would not be treated as the owner if the trustee did not possess the power to make an adjustment; or
(4) If the terms of the trust instrument clearly deny the trustee the power to make adjustments.
Acts 2001, No. 520, §4; Acts 2003, No. 480, §1.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2160. Adjustment benefiting trustee

RS 9:2160 - Adjustment benefiting trustee
A trustee may not make an adjustment under R.S. 9:2158 that benefits himself, directly or indirectly, unless all of the current beneficiaries consent or the proper court authorizes such adjustment after notice to all current beneficiaries.
Acts 2001, No. 520, §4.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2161. Adjustment beyond percentage limit

RS 9:2161 - Adjustment beyond percentage limit
A. A court order shall be required in order for the trustee to make an adjustment from principal to income under R.S. 9:2158 if the amount of the adjustment from principal, when added to the amount of the net income of the trust for the year, exceeds five percent of the net fair market value of the assets of the trust at the beginning of the year.
B. A court order shall be required in order for the trustee to make an adjustment from income to principal under R.S. 9:2158 if the amount of the adjustment from income reduces the net income for the year below five percent of the net fair market value of the assets of the trust at the beginning of the year.
Acts 2001, No. 520, §4.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2162. General provisions regarding court orders affecting adjustments

RS 9:2162 - General provisions regarding court orders affecting adjustments
A trustee may apply for a court order under R.S. 9:2160 or 2161, or to obtain approval from the court of any other decision to adjust or not to adjust under R.S. 9:2158. The following provisions apply to such an action:
(1) The proceeding shall be governed by R.S. 9:2233(A).
(2) All current beneficiaries of the trust must approve the adjustment or be given the opportunity to oppose it.
(3) A trustee's decision to adjust or not to adjust shall be approved by the court if the trustee's petition sets forth the reasons for the adjustment, or decision not to adjust, the facts upon which the trustee relies, and an explanation of how the income and principal beneficiaries will be affected, unless a beneficiary establishes that the adjustment, or decision not to adjust, would be an abuse of the trustee's discretion.
(4) An order may authorize adjustments, or non-adjustments, for future years as well as the current year, subject to the right of a person in a subsequent year who is at that time a current beneficiary of the trust to apply to the proper court to have the order modified or rescinded.
(5) For purposes of this Subpart, the "current beneficiaries" of a trust as of any date are the persons who are then the principal beneficiaries of the trust and the persons to whom the trustee is then required or permitted to distribute the income of the trust.
Acts 2001, No. 520, §4.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2163. Remedies

RS 9:2163 - Remedies
If a court determines that a trustee has abused his discretion in making or failing to make an adjustment under R.S. 9:2158, the court shall restore the beneficiaries to the positions they would have occupied if the trustee had not abused his discretion, according to the following rules:
(1) When the abuse of discretion has resulted in no distribution to a beneficiary or a distribution that is too small, the court shall require the trustee to distribute from the trust to the beneficiary an amount that the court determines will restore the beneficiary to an appropriate economic position.
(2) When the abuse of discretion has resulted in a distribution to a beneficiary that is too large, the court shall require the trustee to withhold an amount from one or more future distributions to the beneficiary or require the beneficiary to return some or all of the distribution to the trust.
(3) When the court is unable, by means of Paragraphs (1) and (2), to restore the beneficiaries, the trust, or both to the positions they would have occupied if the trustee had not abused his discretion, the court may require the trustee to pay an appropriate amount from his own funds to one or more of the beneficiaries or the trust or both.
Acts 2001, No. 520, §4.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2164. Underproductive property

RS 9:2164 - Underproductive property
If a marital deduction is allowed for all or part of a trust whose assets consist substantially of property that does not provide the spouse with sufficient income from or use of the trust assets, and if the amounts that the trustee transfers from principal to income under R.S. 9:2158 and distributes to the spouse from principal pursuant to the terms of the trust are insufficient to provide the spouse an interest required to obtain the marital deduction, the spouse may require the trustee to make property productive of income, convert property within a reasonable time, or exercise the power conferred by R.S. 9:2158. The trustee may decide which action or combination of actions to take.
Acts 2020, No. 17, §1, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2171. Individual and corporate trustees

RS 9:2171 - Individual and corporate trustees
An individual trustee shall furnish security for the faithful performance of his duties, unless the trust instrument dispenses with security. A corporate trustee need not furnish security unless security is required by the trust instrument.
The amount and type of security shall be approved by the proper court if not provided for in the trust instrument.
Acts 2020, No. 17, §4, eff. Jan. 1, 2021.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2192. Indemnity for expenses not properly incurred

RS 9:2192 - Indemnity for expenses not properly incurred
If an expense is not properly incurred in the administration of a trust, a trustee is entitled to indemnity from the trust estate for such an expense to the extent that he has thereby conferred a benefit upon the trust estate, unless the trust instrument provides to the contrary, or unless the circumstances make it inequitable to allow him indemnity.
If an expense is not properly incurred in the administration of a trust, a trustee is entitled to indemnity from the trust estate for the full amount of the expense, if the transaction in which the expense is incurred is of such a character that the beneficiary is in a position either to reject or accept it and he accepts it.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2193. Liability of beneficiary

RS 9:2193 - Liability of beneficiary
If the trust estate is not sufficient to indemnify a trustee for expenses properly incurred by him in the administration of a trust, a beneficiary shall be personally liable only if the trustee can show an express or implied contract between that beneficiary and himself that would entitle the trustee to indemnity.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2194. Charge on beneficiary's interest

RS 9:2194 - Charge on beneficiary's interest
If a beneficiary is liable to a trustee as such, his interest in the trust estate is subject to a charge for the amount of his liability; but a trustee is not entitled to a charge on a beneficiary's interest in the trust estate to secure a beneficiary's liability not connected with the administration of the trust, unless the beneficiary contracts to give him such a charge.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2195. Charge on beneficiary's interest; advance or loan of trust money

RS 9:2195 - Charge on beneficiary's interest; advance or loan of trust money
If a trustee makes an advance or loan of trust money to a beneficiary, the beneficiary's interest is subject to a charge for the repayment of the amount advanced or lent.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2196. Indemnity for tort liability

RS 9:2196 - Indemnity for tort liability
A. A trustee who has incurred personal liability for a tort committed in the administration of the trust is entitled to indemnity from the trust estate if:
(1) The tort was a common incident of the kind of business activity in which the trustee was properly engaged for the trust, or,
(2) Although the tort was not a common incident of such activity, if neither the trustee nor an officer or employee of the trustee was guilty of personal fault in incurring the liability.
B. If a trustee has committed a tort that has increased the value of the trust property, he is entitled to indemnity from the trust estate to the extent of the increase in value, even though he would not otherwise be entitled to indemnity.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2201. General rule

RS 9:2201 - General rule
If a trustee commits a breach of trust he shall be chargeable with:
(1) A loss or depreciation in value of the trust estate resulting from a breach of trust; or
(2) A profit made by him through breach of trust; or
(3) A profit that would have accrued to the trust estate if there had been no breach of trust.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2203. Balancing losses against gains

RS 9:2203 - Balancing losses against gains
A trustee who is liable for a loss occasioned by one breach of trust cannot reduce the amount of his liability by deducting the amount of a gain that has accrued through another distinct breach of trust; but if the two breaches of trust are not distinct, a trustee is accountable only for the net gain or chargeable only for the net loss resulting therefrom.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2204. Liability of successor trustee

RS 9:2204 - Liability of successor trustee
A trustee shall not be liable to a beneficiary for a breach of trust committed by a predecessor trustee, unless he:
(1) Knows or should know of a situation constituting a breach of trust committed by his predecessor and improperly permits it to continue; or
(2) Neglects to take proper steps to compel the predecessor to deliver the trust property to him; or
(3) Neglects to take proper steps to redress a breach of trust committed by the predecessor.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2205. Liability of co-trustee

RS 9:2205 - Liability of co-trustee
A trustee shall not be liable to a beneficiary for a breach of trust committed by a co-trustee, unless he:
(1) Participates in a breach of trust committed by his co-trustee;
(2) Delegates improperly the administration of the trust to his co-trustee;
(3) Conceals, approves, or acquiesces in a breach of trust committed by his co-trustee;
(4) Enables his co-trustee to commit a breach of trust by his failure to exercise reasonable care in the administration of the trust; or
(5) Neglects to take proper steps to compel his co-trustee to redress a breach of trust.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2206. Relief from liability by trust instrument

RS 9:2206 - Relief from liability by trust instrument
A. The trust instrument may relieve the trustee from liability, except as provided in Sub-sections B and C of this section.
B. A provision in the trust instrument is not effective to relieve the trustee from liability for breach of the duty of loyalty to a beneficiary or for breach of trust committed in bad faith.
C. A provision in the trust instrument is not effective to relieve the trustee from liability if it is inserted as a result of an abuse by the trustee of a fiduciary or confidential relationship to the settlor.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2207. Relief from liability by beneficiary

RS 9:2207 - Relief from liability by beneficiary
A beneficiary who is acting with knowledge of the material facts and whose action is not improperly induced by the conduct of a trustee may, by written instrument delivered to a trustee, relieve a trustee from liabilities that otherwise would be imposed upon him. The instrument shall not be effective if it limits prospectively and in general terms a trustee's liability for breach of the duty of loyalty to a beneficiary, or for breach of trust in bad faith.
Amended by Acts 2020, No. 18, §1.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2221. Remedies against trustee

RS 9:2221 - Remedies against trustee
A beneficiary of a trust may institute an action:
(1) To compel a trustee to perform his duties as trustee;
(2) To enjoin a trustee from committing a breach of trust;
(3) To compel a trustee to redress a breach of trust;
(4) To remove a trustee.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2222. Remedies against third persons

RS 9:2222 - Remedies against third persons
A trustee is the proper plaintiff to sue to enforce a right of the trust estate, except that a beneficiary may sue to enforce such a right, in order to protect his own interest, in an action against:
(1) A trustee and an obligor, if the trustee improperly refuses, neglects, or is unable for any reason, to bring an action against the obligor; or
(2) An obligor, if there is no trustee or the trustee cannot be subjected to the jurisdiction of the proper court.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2231. Causes of action; procedure

RS 9:2231 - Causes of action; procedure
If a cause or right of action accrues to a beneficiary against a trustee or a settlor or both, to a trustee against a beneficiary or a settlor or both, or to a settlor against a beneficiary or a trustee or both, the action may be by summary proceeding.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2232. Injunctive relief

RS 9:2232 - Injunctive relief
If irreparable injury, loss, or damage will otherwise result, the injunctive relief authorized by Articles 3601 through 3613 of the Code of Civil Procedure may be granted to a beneficiary as against a trustee or a settlor or both, to a trustee against a beneficiary or a settlor or both, or to a settlor against a beneficiary or a trustee or both.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2233. Instructions

RS 9:2233 - Instructions
A. A trustee, a beneficiary, or a settlor in an ordinary or a summary proceeding may apply to the proper court for instructions concerning the trust instrument, the interpretation of the instrument, or the administration of the trust. An order of a proper court issued pursuant to such an application shall be full authority to act in accordance thereunder, and a trustee shall be fully protected from all claims of any person who has or who may subsequently acquire an interest in the trust property.
B. A trustee may apply for instructions in ex parte proceedings. The order issued therein will protect a third party relying on the order, but will not exonerate a trustee from liability to a settlor or a beneficiary.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2234. Prescription

RS 9:2234 - Prescription
A. An action for damages by a beneficiary against a trustee for any act, omission, or breach of duty shall be brought within two years of the date that the trustee renders, by actual delivery or mail to the beneficiary, or if the beneficiary lacks legal capacity, the beneficiary's legal representative, to the last known address of the beneficiary and that of the legal representative if any, an accounting for the accounting period in which the alleged act, omission, or breach of duty arising out of the matters disclosed therein occurred. However, such actions shall in all events, even as to actions within two years of disclosure, be filed within three years of the date that the trustee renders an accounting for the accounting period in which the alleged act, omission, or breach of duty occurred. If a beneficiary is a minor when a trustee's accounting for the accounting period in which the alleged act, omission, or breach of duty occurred is rendered, the prescriptive period of two years begins to run from the day he reaches the age of eighteen years.
B. Any action by a beneficiary against a trustee other than those described on Subsection A of this Section is prescribed by two years beginning from the date that the trustee renders his final account to the beneficiary.
C. The provisions of this Section are remedial and apply to all causes of action for damages without regard to the date when the alleged act, omission, or breach of duty occurred. The two-year and three-year periods of limitation provided for in this Section are peremptive periods within the meaning of Civil Code Article 3458, and in accordance with Civil Code Article 3461 may not be renounced, interrupted, or suspended. Notwithstanding the foregoing, a beneficiary shall have one year from July 9, 1999, to bring an action for damages against a trustee arising out of an act, omission, or breach of duty for a transaction disclosed in any prior accounting.
D. Notwithstanding any other provision of law, all actions brought in the state against any trustee, the prescriptive and peremptive period shall be governed exclusively by this Section.
Amended by Acts 1980, No. 309, §1; Acts 1999, No. 966, §1, eff. July 9, 1999.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2235. Proper court

RS 9:2235 - Proper court
The proper court for an action under this Chapter shall be determined as follows:
A.(1) In the case of an inter vivos trust, the proper court shall be the district court of any parish that the trust instrument effectively designates as the proper court.
(2) If the trust instrument fails to designate a proper court for an inter vivos trust, any of the following are proper courts:
(a) The district court of the parish in which a settlor was domiciled when the trust was created.
(b) If the trust has a trustee domiciled in Louisiana, the district court of the parish in which a trustee is domiciled.
(c) If the trust has no trustee domiciled in Louisiana, the district court in which the agent for service of process of any nonresident trustee is domiciled.
(3) If the trust instrument fails to designate a proper court for an inter vivos trust, and none of the courts specified in Paragraph (2) of this Subsection are available, the proper court shall be the Nineteenth Judicial District Court.
B. In the case of a testamentary trust, the proper court shall be the district court of the parish having jurisdiction over the settlor's succession, which shall continue as the proper court unless the settlor in the trust instrument has designated a proper court. In that event, the settlor's designation shall be effective after the trustee is put into possession of the entire legacy.
C. The foregoing notwithstanding, in the case of a testamentary trust after the trustee is put into possession of the entire legacy, and in the case of any inter vivos trust, the proper court shall be any court agreed to by all trustees, beneficiaries, and living settlors.
D. Once a matter regarding an inter vivos trust has been litigated in a district court, that court shall continue as the sole proper court absent the agreement described in Subsection C of this Section.
E. Amendments to a trust instrument that attempt to designate a proper court after institution of an action shall have no effect on the selection of the proper court.
Acts 2010, No. 390, §1.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2241. General rule

RS 9:2241 - General rule
The trustee shall select the attorney to handle legal matters relating to the trust. The appointment of an attorney in the trust instrument is not binding on the trustee.
Acts 1983, No. 622, §1; Acts 2003, No. 480, §1; Acts 2008, No. 325, §1.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2242. Registered agent for service of process

RS 9:2242 - Registered agent for service of process
A.(1) Any trust created to provide for the payment of settlement of claims or judgments as provided in R.S. 22:46(9)(b) or to pool liabilities as provided in R.S. 23:1195 may appoint a registered agent for service of process. The registered agent may be an individual who is a resident of this state or a partnership or professional law corporation which is authorized to practice law in this state. Legal process and other notices or demands may be served on the trust by service upon the registered agent and, if the registered agent is a partnership, upon any partner.
(2) Written notice of the full name and post office address of the registered agent and a notarized affidavit of acknowledgment and acceptance signed by the registered agent shall be delivered by hand or United States mail to the secretary of state. The failure to deliver a notarized affidavit of acknowledgment and acceptance as required by this Subsection shall not be a defense to proper service of process on the trust. The address of the registered agent may be changed by the registered agent or trust filing written notice of the change with the secretary of state. A copy of the change of address shall also be filed with the recorder of mortgages of the parish of the domicile of the trust. Notice of the change of the name of a professional law corporation or partnership as registered agent shall be filed in the same manner within thirty days after the change.
(3) A registered agent may resign and his resignation shall be effective when written notice thereof has been given to the trust, the secretary of state, and the recorder of mortgages of the parish in which the trust is domiciled. When the registered agent resigns, or if the trust ceases to maintain a registered agent, a successor registered agent may be appointed by the trust within thirty days after the resignation or other event which terminated the tenure of the former registered agent. The full name and post office address of the successor registered agent shall be certified in writing, signed in the name of the trust by at least one trustee, and filed with the secretary of state and the appropriate recorder of mortgages. Upon compliance with the provisions of this Section, including the requirement of a notarized affidavit of acceptance, the successor registered agent shall be vested with the powers of the registered agent succeeded.
B. The secretary of state and each recorder of mortgages of the parish where the trust is domiciled shall keep, for public inspection, a permanent record of registered agents, showing all changes and the date thereof.
Acts 2008, No. 325, §1.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2252. Saving clause

RS 9:2252 - Saving clause
Trusts heretofore created and any provisions or dispositions therein made shall be governed by the laws in effect at the time of their creation. Unless otherwise provided in the trust instrument, trusts created prior to the effective date of this Code shall be governed in all administrative and procedural matters by the provisions of this Code and not by laws in effect at the time of creation of such trusts, and trusts created prior to the adoption of any amendment to this Code shall be governed in administrative and procedural matters by the provisions of the amendment.
Amended by Acts 1968, No. 137, §1.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2260.1. Definitions

RS 9:2260.1 - Definitions
As used in this Chapter:
(1) "Adult" means an individual who has attained the age of eighteen years.
(2) "Beneficiary" means an individual for whom property has been transferred to or held under a declaration of trust by a custodial trustee for the individual's use and benefit under this Chapter.
(3) "Court" means a court of competent jurisdiction.
(4) "Curator" means a person appointed or qualified by a court to manage the estate of an individual or a person legally authorized to perform substantially the same functions.
(5) "Custodial trust property" means an interest in property transferred to or held under a declaration of trust by a custodial trustee under this Chapter and the income from and proceeds of that interest.
(6) "Custodial trustee" means a person designated as trustee of a custodial trust under this Chapter or a substitute or successor to the person designated.
(7) "Incapacitated" means lacking the ability to manage property and business affairs effectively by reason of mental illness, mental deficiency, physical illness or disability, chronic use of drugs, chronic intoxication, confinement, detention by a foreign power, disappearance, minority, or other disabling cause.
(8) "Legal representative" means a personal representative, tutor, or curator.
(9) "Member of the beneficiary's family" means a beneficiary's spouse, descendant, stepchild, parent, stepparent, grandparent, brother, sister, uncle, or aunt, whether of the whole or half blood or by adoption.
(10) "Person" means an individual, corporation, business trust, estate, trust, partnership, joint venture, association, or any other legal or commercial entity.
(11) "Personal representative" means an executor, administrator, or representative of a decedent's estate, a person legally authorized to perform substantially the same functions, or a successor to any of them.
(12) "State" means a state, territory, or possession of the United States, the District of Columbia, or the Commonwealth of Puerto Rico.
(13) "Transferor" means a person who creates a custodial trust by transfer or declaration.
(14) "Trust company" means a financial institution, corporation, or other legal entity, authorized to exercise general trust powers.
(15) "Tutor" means a person appointed or qualified by a court to act as guardian of a minor's property or a person legally authorized to perform substantially the same functions.
Acts 1995, No. 655, §1, eff. Jan. 1, 1998.
2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:2260.2. Custodial trust; general

RS 9:2260.2 - Custodial trust; general
A. A person may create a custodial trust of property by a written transfer of the property to another person, evidenced by registration or by other instrument of transfer, executed in any lawful manner naming as beneficiary an individual, who may be the transferor, in which the transferee is designated, in substance, as custodial trustee under the Louisiana Uniform Custodial Trust Act.
B. A person may create a custodial trust of property by a written declaration, evidenced by registration of the property or by other instrument of declaration executed in any lawful manner, describing the property and naming as beneficiary an individual other than the declarant, in which the declarant as titleholder is designated, in substance, as custodial trustee under the Louisiana Uniform Custodial Trust Act. A registration or other declaration of trust for the sole benefit of the declarant is not a custodial trust under this Chapter.
C. Title to custodial trust property is in the custodial trustee and the beneficial interest is in the beneficiary.
D. Except as provided in Subsection E, a transferor may not terminate a custodial trust.
E. The beneficiary, if not incapacitated, or the curator of an incapacitated beneficiary, may terminate a custodial trust by delivering to the custodial trustee a writing signed by the beneficiary or curator declaring the termination. If not previously terminated, the custodial trust terminates on the death of the beneficiary.
F. Any person may augment existing custodial trust property by the addition of other property pursuant to this Chapter.
G. The transferor may designate or authorize the designation of a successor custodial trustee in the trust instrument.
H. This Chapter does not displace or restrict other means of creating trusts. A trust the terms of which do not conform to this Chapter may be enforceable according to its terms under other law.
Acts 1995, No. 655, §1, eff. Jan. 1, 1998.