2009 California Probate Code - Section 16220-16249 :: :: Article 2. :: Specific Powers Of Trustees (2024)

PROBATE CODE
SECTION 16220-16249

16220. The trustee has the power to collect, hold, and retain trustproperty received from a settlor or any other person until, in thejudgment of the trustee, disposition of the property should be made.The property may be retained even though it includes property inwhich the trustee is personally interested.16221. The trustee has the power to accept additions to theproperty of the trust from a settlor or any other person.16222. (a) Subject to subdivision (b), the trustee has the power tocontinue or participate in the operation of any business or otherenterprise that is part of the trust property and may effectincorporation, dissolution, or other change in the form of theorganization of the business or enterprise. (b) Except as provided in subdivision (c), the trustee maycontinue the operation of a business or other enterprise only asauthorized by the trust instrument or by the court. For the purposeof this subdivision, the lease of four or fewer residential units isnot considered to be the operation of a business or other enterprise. (c) The trustee may continue the operation of a business or otherenterprise for a reasonable time pending a court hearing on thematter or pending a sale of the business or other enterprise. (d) The limitation provided in subdivision (b) does not affect anypower to continue or participate in the operation of a business orother enterprise that the trustee has under a trust created by aninstrument executed before July 1, 1987.16224. (a) In the absence of an express provision to the contraryin a trust instrument, where the instrument directs or permitsinvestment in obligations of the United States government, thetrustee has the power to invest in those obligations directly or inthe form of an interest in a money market mutual fund registeredunder the Investment Company Act of 1940 (15 U.S.C. Sec. 80a-1 etseq.) or an investment vehicle authorized for the collectiveinvestment of trust funds pursuant to Section 9.18 of Part 9 of Title12 of the Code of Federal Regulations, the portfolios of which arelimited to United States government obligations maturing not laterthan five years from the date of investment or reinvestment and torepurchase agreements fully collateralized by United Statesgovernment obligations. (b) This section applies only to trusts created on or afterJanuary 1, 1985.16225. (a) The trustee has the power to deposit trust funds atreasonable interest in any of the following accounts: (1) An insured account in a financial institution. (2) To the extent that the account is collateralized, an accountin a bank, an account in an insured savings and loan association, oran account in an insured credit union. (b) A trustee may deposit trust funds pursuant to subdivision (a)in a financial institution operated by, or that is an affiliate of,the trustee. For the purpose of this subdivision, "affiliate" means acorporation that directly or indirectly through one or moreintermediaries controls, is controlled by, or is under common controlwith another domestic or foreign corporation. (c) This section does not limit the power of a trustee in a propercase to deposit trust funds in an account described in subdivision(a) that is subject to notice or other conditions respectingwithdrawal prescribed by law or governmental regulation. (d) The court may authorize the deposit of trust funds in anaccount described in subdivision (a) in an amount greater than themaximum insured or collateralized amount. (e) Nothing in this section prevents the trustee from holding anamount of trust property reasonably necessary for the orderlyadministration of the trust in the form of cash or in a checkingaccount without interest.16226. The trustee has the power to acquire or dispose of property,for cash or on credit, at public or private sale, or by exchange.16227. The trustee has the power to manage, control, divide,develop, improve, exchange, partition, change the character of, orabandon trust property or any interest therein.16228. The trustee has the power to encumber, mortgage, or pledgetrust property for a term within or extending beyond the term of thetrust in connection with the exercise of any power vested in thetrustee.16229. The trustee has the power to do any of the following: (a) Make ordinary or extraordinary repairs, alterations, orimprovements in buildings or other trust property. (b) Demolish any improvements. (c) Raze existing or erect new party walls or buildings.16230. The trustee has the power to do any of the following: (a) Subdivide or develop land. (b) Dedicate land to public use. (c) Make or obtain the vacation of plats and adjust boundaries. (d) Adjust differences in valuation on exchange or partition bygiving or receiving consideration. (e) Dedicate easem*nts to public use without consideration.16231. The trustee has the power to enter into a lease for anypurpose as lessor or lessee with or without the option to purchase orrenew and for a term within or extending beyond the term of thetrust.16232. The trustee has the power to enter into a lease orarrangement for exploration and removal of gas, oil, or otherminerals or geothermal energy, and to enter into a community oillease or a pooling or unitization agreement, and for a term within orextending beyond the term of the trust.16233. The trustee has the power to grant an option involvingdisposition of trust property or to take an option for theacquisition of any property, and an option may be granted or takenthat is exercisable beyond the term of the trust.16234. With respect to any shares of stock of a domestic or foreigncorporation, any membership in a nonprofit corporation, or any otherproperty, a trustee has the power to do any of the following: (a) Vote in person, and give proxies to exercise, any votingrights with respect to the shares, memberships, or property. (b) Waive notice of a meeting or give consent to the holding of ameeting. (c) Authorize, ratify, approve, or confirm any action that couldbe taken by shareholders, members, or property owners.16235. The trustee has the power to pay calls, assessments, and anyother sums chargeable or accruing against or on account ofsecurities.16236. The trustee has the power to sell or exercise stocksubscription or conversion rights.16237. The trustee has the power to consent, directly or through acommittee or other agent, to the reorganization, consolidation,merger, dissolution, or liquidation of a corporation or otherbusiness enterprise, and to participate in voting trusts, poolingarrangements, and foreclosures, and in connection therewith, todeposit securities with and transfer title and delegate discretion toany protective or other committee as the trustee may deem advisable.16238. The trustee has the power to hold a security in the name ofa nominee or in other form without disclosure of the trust so thattitle to the security may pass by delivery.16239. The trustee has the power to deposit securities in asecurities depository, as defined in Section 30004 of the FinancialCode, which is licensed under Section 30200 of the Financial Code oris exempt from licensing by Section 30005 or 30006 of the FinancialCode. The securities may be held by the securities depository in themanner authorized by Section 775 of the Financial Code.16240. The trustee has the power to insure the property of thetrust against damage or loss and to insure the trustee againstliability with respect to third persons.16241. The trustee has the power to borrow money for any trustpurpose to be repaid from trust property. The lender may include, butis not limited to, a bank holding company, affiliate, or subsidiaryof the trustee.16242. The trustee has the power to do any of the following: (a) Pay or contest any claim. (b) Settle a claim by or against the trust by compromise,arbitration, or otherwise. (c) Release, in whole or in part, any claim belonging to thetrust.16243. The trustee has the power to pay taxes, assessments,reasonable compensation of the trustee and of employees and agents ofthe trust, and other expenses incurred in the collection, care,administration, and protection of the trust.16244. The trustee has the following powers: (a) To make loans out of trust property to the beneficiary onterms and conditions that the trustee determines are fair andreasonable under the circ*mstances. (b) To guarantee loans to the beneficiary by encumbrances on trustproperty.16245. The trustee has the power to pay any sum of principal orincome distributable to a beneficiary, without regard to whether thebeneficiary is under a legal disability, by paying the sum to thebeneficiary or by paying the sum to another person for the use orbenefit of the beneficiary. Any sum distributable under this sectionto a custodian under the California Uniform Transfers to Minors Act(Part 9 (commencing with Section 3900)) shall be subject to Section3906.16246. The trustee has the power to effect distribution of propertyand money in divided or undivided interests and to adjust resultingdifferences in valuation. A distribution in kind may be made pro rataor non pro rata, and may be made pursuant to any written agreementproviding for a non pro rata division of the aggregate value of thecommunity property assets or quasi-community property assets, orboth.16247. The trustee has the power to hire persons, includingaccountants, attorneys, auditors, investment advisers, appraisers(including probate referees appointed pursuant to Section 400), orother agents, even if they are associated or affiliated with thetrustee, to advise or assist the trustee in the performance ofadministrative duties.16248. The trustee has the power to execute and deliver allinstruments which are needed to accomplish or facilitate the exerciseof the powers vested in the trustee.16249. The trustee has the power to prosecute or defend actions,claims, or proceedings for the protection of trust property and ofthe trustee in the performance of the trustee's duties.