Exculpation of Trustee

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  1. A provision 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.
  2. 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.


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