APRIL 2023 BAR BULLETIN APRIL 2023 | Page 16

PROBATE CORNER

Limitations on Corporate Fiduciaries in Florida

DAVID M . GARTEN

PROS AND CONS IN CHOOSING A CORPORATE FIDUCIARY :

PROS

Expert Management : Corporate fiduciaries are highly trained at what they do . They ’ ll have multiple staff members with many years of experience in dealing with administration issues .

Neutrality : With no immediate ties to your beneficiaries , corporate fiduciaries won ’ t have the emotional stress and strain that a family member or friend could be subject to when serving . A corporate fiduciary won ’ t be biased by a beneficiary ’ s past choices or present lifestyle and will simply administer the estate , trust , or guardianship as provided by the explicit terms of the existing estate planning documents and Florida law .

One-Stop-Shop : A bank or independent trust company acting as a fiduciary will have all of the resources they need under one roof . This could include investment services , brokerage services , estate or trust accounting services , and business and real estate management services .

High Standard of Care : Corporate fiduciaries are required to be licensed , bonded , and insured . They are subject to strict state and federal regulations and held to a very high standard of care above and beyond the average person when managing an estate , trust , or guardianship .

CONS

Lack of Flexibility : Corporate fiduciaries can be extremely rigid and set in their ways when it comes to investing , managing , and spending the assets of an estate , trust , or guardianship . This lack of flexibility can lead to unhappy beneficiaries who will be forced to go to court to resolve disputes between them and the institution .

Expensive : In order to provide all of its professional services , a corporate fiduciary will generally cost more than an individual fiduciary .

Committee Approach : Corporate fiduciaries use committees to make many of their decisions , which can lead to slow responses to a beneficiary ’ s questions or concerns as well as prolonged administration .

Bureaucracy : Corporate fiduciaries are corporations made up of multiple departments and offices located in different buildings and , perhaps , various cities . Finding someone who can help on short notice can be a daunting task .

ARE THERE LIMITATIONS ON WHO CAN BE A CORPORATE FIDUCIARY IN FLORIDA ? YES

Not all corporations can act in a fiduciary capacity . Sec . 660.41 , F . S . entitled “ Corporations ; certain fiduciary functions prohibited ” reads :

All corporations are prohibited from exercising any of the powers or duties and from acting in any of the capacities , within this state , as follows :

( 1 ) As personal representative of the estate of any decedent , whether such decedent was a resident of this state or not , and whether the administration of the estate of such decedent is original or ancillary ; however , if the personal representative of the estate of a nonresident decedent is a corporation duly authorized , qualified , and acting as such personal representative in the jurisdiction of the domicile of the decedent , it may as a foreign personal representative perform such duties and exercise such powers and privileges as are required , authorized , or permitted by s . 734.101 .

( 2 ) As receiver or trustee under appointment of any court in this state .

( 3 ) As assignee , receiver , or trustee of any insolvent person or corporation or under any assignment for the benefit of creditors .

( 4 ) As fiscal agent , transfer agent , or registrar of any municipal or private corporation , except that this prohibition shall not be so construed as to prevent banks , associations , and trust companies not located in this state from acting within the state where located as fiscal agent , transfer agent , or registrar of municipal or private corporations of this state . Nothing herein shall prevent any Florida corporation that is not a bank , association , or trust company and that does not have trust powers from being its own fiscal agent , transfer agent , or registrar concerning its own affairs , stock , or securities . Nothing herein shall prevent any Florida corporation or corporation having its principal place of business in Florida registered as a transfer agent with the Federal Deposit Insurance Corporation , the Comptroller of the Currency , the Board of Governors of the Federal Reserve System , or the Securities and Exchange Commission from acting as a transfer agent for any other private corporation .

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SAVE THE DATE Judicial Reception Wednesday , April 19 th 5:30 P . M . - 7:30 P . M . Lake Pavilion 101 S . Flagler Dr . West Palm Beach 33401

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PBCBA BAR BULLETIN 16