§554-2 Nomination by beneficiaries; appointment of trustees. (a) Whenever any appointment of a trustee under a private trust is made by any court of record, if, prior to such appointment, beneficiaries who constitute a majority both in number and interest of the beneficiaries of the trust (as hereinafter defined) nominate for the trusteeship by an instrument or instruments in writing filed in the court any qualified person or corporation worthy in the opinion of the court to be appointed, the court shall appoint the nominee as the trustee, unless the express terms of the trust provide an effective method of nomination or appointment. No person so nominated as trustee by the beneficiaries of any such trust shall be held disqualified to be appointed or to act as the trustee for the sole reason that the person is a beneficiary or a possible beneficiary under the trust estate.
(b) The term "majority both in number and interest of the beneficiaries of the trust," as used in this section, means a majority of the competent adult beneficiaries holding more than one-half of the value of the then vested interests held by all the competent adult beneficiaries in the trust; provided that if the guardian of any spendthrift, non compos person, or minor, owning such a vested interest, when the guardian is not an adult beneficiary, or married to an adult beneficiary, of the trust, executes or joins in the execution of any instrument of nomination and presents the same to the court (each such guardian being hereby authorized in the guardian's discretion either to execute or to refrain from executing the instrument of nomination, as in the guardian's judgment shall be in the best interest of the guardian's ward), then the spendthrift, non compos person, or minor, and the value of the spendthrift's, non compos person's, or minor's interest shall be included in determining the majority both in number and interest of the beneficiaries of the trust. The value of the then vested interests shall be determined as of the date of the presentation of the instrument or instruments of nomination to the court, in the manner provided for the appraisal of similar interests under the laws of the State for inheritance tax purposes and as the same would be valued for the purposes if the trust had been created by instrument made in contemplation of the death of the person who created the trust and the trust had come into existence and the death had occurred on the date of presentation of the instrument or instruments of nomination. When more than one instrument is presented to the court designating the same nominee, the date of presentation for the purposes of this section shall be deemed to be the date when the last instrument is so presented.
(c) This section applies to trusts created before, as well as to those created after April 28, 1943. [L 1943, c 68, §1 and pt of §2; RL 1945, §12572; RL 1955, §340-2; HRS §554-2; am L 1972, c 145, §3(b); gen ch 1985]
Case Notes
Determination of majority in number and interest. 42 H. 640 (1958).
Cited: 235 F.2d 223 (1956).