A. A term of a trust relieving a trustee of liability for breach of trust is unenforceable to the extent that it:
(1) relieves the trustee of liability for breach of trust committed in bad faith or with reckless indifference to the purposes of the trust or the interests of the beneficiaries; or
(2) was inserted as the result of an abuse by the trustee of a fiduciary or confidential relationship to the settlor.
B. An exculpatory term drafted or caused to be drafted by the trustee is invalid as an abuse of a fiduciary or confidential relationship unless the trustee proves that the exculpatory term is fair under the circumstances and that its existence and contents were adequately communicated to the settlor.
History: Laws 2003, ch. 122, § 10-1007; recompiled as § 46A-10-1008 by Laws 2007, ch. 128, § 30.
ANNOTATIONSRecompilation. — Laws 2007, ch. 128, § 30 recompiled former 46A-10-1007 NMSA 1978, as enacted by Laws 2003, ch. 122, § 10-1007, as 46A-10-1008 NMSA 1978, effective July 1, 2007.
Law reviews. — For article, "The New Mexico Uniform Trust Code," see 34 N.M.L. Rev. 1 (2004).