Fla. Stat. § 736.0709 - Commentary to Florida Trust Code

Legal Commentary on Fla. Stat. § 736.0709

Fla. Stat. § 736.0709 establishes that a trustee has a right to be reimbursed for trust expenses paid by the trustee. To be reimbursed for an expense, the expense must be both reasonable and properly incurred. These requirements echo Fla. Stat. § 736.0805, which requires that a trustee only incur reasonable expenses. A trustee may charge interest to the trust for the expenses incurred “as appropriate.” No guidance is given as to when charging interest would be appropriate.

Subsection (2) creates a lien against the trust property, securing a trustee’s right to reimbursement, whenever the trustee advanced money to the trust “for the protection of the trust.” This works in conjunction with Fla. Stat. § 736.0802(7)(e), which states that a trustee’s duty of loyalty is not breached by an “advance by the trustee of money for the protection of the trust.” Indeed, such an advance of money would be in furtherance of a trustee’s duty under Fla. Stat. § 736.0809 to “take reasonable steps to take control of and protect the trust property.”

Text of Fla. Stat. § 736.0709

Reimbursement of expenses.—

(1) A trustee is entitled to be reimbursed out of the trust property, with interest as appropriate, for reasonable expenses that were properly incurred in the administration of the trust.

(2) An advance by the trustee of money for the protection of the trust gives rise to a lien against trust property to secure reimbursement with reasonable interest.

History of Fla. Stat. § 736.0709

Fla. Stat. § 736.0709 became law on July 1, 2007 as part of the Florida Trust Code. It has not been amended or revised since that date.

Fla. Stat. § 736.0709 is based on § 709 of the Uniform Trust Code, which reads:

(a) A trustee is entitled to be reimbursed out of the trust property, with interest as appropriate, for:

(1) expenses that were properly incurred in the administration of the trust; and

(2) to the extent necessary to prevent unjust enrichment of the trust, expenses that were not properly incurred in the administration of the trust.

(b) An advance by the trustee of money for the protection of the trust gives rise to a lien against trust property to secure reimbursement with reasonable interest.

§ 709(a)(2) of the Uniform Trust Code—which was based on Restatement (Second) of Trusts § 245 (1959)—was removed from the version codified in the Florida Trust Code. Thus, Florida does not have statutory support for a trustee being reimbursed for any expense not properly incurred in the administration of the a trust, even in cases of unjust enrichment.

This article is part of the PTM Legal Commentary to the Florida Trust Code. Click here to navigate through the entire commentary.