(2) Subject to the rights of persons dealing with or assisting the trustee as provided in ORS 130.855, a sale, encumbrance or other transaction involving the investment or management of trust property entered into by the trustee for the trustee’s own personal account or that is otherwise affected by a conflict between the trustee’s fiduciary and personal interests is voidable by a beneficiary affected by the transaction unless:
(a) The transaction was authorized by the terms of the trust;
(b) The transaction was approved by a court;
(c) The beneficiary did not commence a judicial proceeding within the time allowed by ORS 130.820;
(d) The beneficiary consented to the trustee’s conduct, ratified the transaction or released the trustee in the manner provided by ORS 130.840; or
(e) The transaction involves a contract entered into or claim acquired by the trustee before the person became or contemplated becoming trustee.
(3) A sale, encumbrance or other transaction involving the investment or management of trust property is presumed to be affected by a conflict between the personal and fiduciary interests of the trustee if it is entered into by the trustee with:
(a) The trustee’s spouse;
(b) The trustee’s descendants, siblings or parents, or their spouses;
(c) An agent or attorney of the trustee; or
(d) A corporation or other person or enterprise in which the trustee, or a person that owns a significant interest in the trustee, has an interest that might affect the trustee’s best judgment.
(4) Unless a trustee can establish that the transaction was fair to the beneficiary, a transaction between a trustee and a beneficiary is voidable by the beneficiary if:
(a) The transaction does not concern trust property;
(b) The trustee obtains an advantage from the transaction;
(c) The transaction is outside the ordinary course of the trustee’s business or on terms and conditions substantially less favorable than those the trustee offers similarly situated customers; and
(d) The transaction occurs during the existence of the trust or while the trustee retains significant influence over the beneficiary.
(5) A transaction not concerning trust property in which the trustee engages in the trustee’s individual capacity involves a conflict between personal and fiduciary interests if the transaction concerns an opportunity properly belonging to the trust.
(6) An investment by a trustee in securities of an investment company or an investment trust to which the trustee, or an affiliate of the trustee, provides services in a capacity other than as trustee is not presumed to be affected by a conflict between personal and fiduciary interests if the investment otherwise complies with the prudent investor rule of ORS 130.750 to 130.775. In addition to compensation for acting as trustee, the trustee may be compensated by the investment company or investment trust for providing those services out of fees charged to the trust. If the trustee receives compensation from the investment company or investment trust for providing investment advisory or investment management services, the trustee at least annually shall give notice of the rate and method by which that compensation was determined to the persons entitled under ORS 130.710 to receive a copy of the trustee’s annual report.
(7) In voting shares of stock of a corporation or in exercising powers of control over similar interests in corporations and other forms of business entities, the trustee shall act in the best interests of the beneficiaries. If the trust is an owner of a corporation or other form of business entity, the trustee shall elect or appoint directors or other managers who will manage the corporation or entity in the best interests of the beneficiaries.
(8) This section does not preclude the following transactions, if fair to the beneficiaries:
(a) An agreement between a trustee and a beneficiary relating to the appointment or compensation of the trustee;
(b) Payment of reasonable compensation to the trustee;
(c) A transaction between a trust and another trust, decedent’s estate, custodianship or conservatorship of which the trustee is a fiduciary or in which a beneficiary has an interest;
(d) A deposit of trust money in a financial institution operated by the trustee;
(e) An advance by the trustee of money for the protection of the trust;
(f) An advance by the trustee of money to the trust for the payment of expenses, losses or liabilities sustained by the trustee in the administration of the trust or by reason of owning or possessing any trust assets; or
(g) A loan to the trustee for the protection of the trust, or for the payment of expenses, losses or liabilities sustained by the trustee in the administration of the trust or by reason of owning or possessing any trust assets. A loan under this paragraph may be from a lender operated by, or affiliated with, the trustee.
(9) A trustee is not required to object to a modification, reformation or termination of the trust under ORS 130.045, 130.200, 130.205, 130.210, 130.215, 130.220 or 130.225, or a trust combination or division under ORS 130.230, solely because of the existence of the duty of loyalty under subsection (1) of this section or the duty to administer the trust under ORS 130.650 (1).
(10) The court may appoint a special fiduciary to make a decision with respect to any proposed transaction that might violate this section if entered into by the trustee. [2005 c.348 §60; 2007 c.515 §2; 2013 c.529 §18; 2017 c.81 §3]
Note: Section 4, chapter 81, Oregon Laws 2017, provides:
Sec. 4. The amendments to ORS 130.655 by section 3 of this 2017 Act apply only to transactions occurring on or after the effective date of this 2017 Act [January 1, 2018]. [2017 c.81 §4]