Why Get Court Approval of a Nonjudicial Trust Agreement?
By Adrian P. Thomas, LL.M., J.D. | Shareholder and Founding Partner, Adrian Philip Thomas, P.A.
Quick answer. Parties seek court approval of a nonjudicial trust agreement because an agreement binds only its signatories, while a judgment carries the force and certainty of a court order. Section 736.0111(5) lets any interested person request approval, and trustees often seek it for protection when acting under the agreement.
Key takeaways
- Section 736.0111(5) expressly allows any interested person to request court approval or disapproval of a nonjudicial settlement agreement.
- Section 736.0201 confirms broad judicial authority over trust administration, including determining matters involving trustees and beneficiaries.
- A dissenting beneficiary, a broader class than qualified beneficiaries, may petition to disapprove a proposed modification under Section 736.0410(2).
Why does a trustee want a court order on top of an agreement?
A trustee who acts under a nonjudicial agreement takes on risk. If a beneficiary later challenges the action, the trustee must defend it. A court order approving the agreement reduces that exposure and lets the trustee act under judicial sanction rather than private agreement alone. This protection frequently justifies the proceeding.
What is a common scenario for judicial approval?
A vacancy requires a corporate trustee meeting an asset threshold, and a willing corporate trustee falls short. The interested persons agree to lower the threshold. The incoming corporate trustee wants judicial approval of the modification and of its appointment for certainty of authority. An interested person, often a qualified beneficiary, files a complaint seeking that approval. Construction of an ambiguous term is a second common scenario.
Who can object to a proposed nonjudicial modification?
The class that may object is broader than the class whose consent is required. Section 736.0410(2) permits any beneficiary, a broader class than the qualified beneficiaries, to commence a proceeding to disapprove a proposed modification or termination under Section 736.0412. Plan for this possibility before assuming the matter will proceed unopposed.
Frequently asked questions
Is court approval of a nonjudicial agreement required?
No. It is optional, sought for certainty and trustee protection.
Who can request court approval?
Any interested person, under Section 736.0111(5).
Can a beneficiary block a nonjudicial modification?
A beneficiary may petition to disapprove a proposed modification under Section 736.0410(2), which can shift the matter toward contested litigation.
About the author
Attorney Adrian Philip Thomas is a shareholder and founding partner of Adrian Philip Thomas, P.A., a boutique attorney law firm located in Fort Lauderdale, Florida. He has practiced law for the past 30 years, maintaining an office in Fort Lauderdale, Broward County, Florida. Mr. Thomas is "AV" rated by Martindale-Hubbell and has been selected on multiple occasions as one of Florida's Legal Elite by Florida Trend Magazine and selected as a Super Lawyer. Mr. Thomas concentrates his practice in estate and trust litigation, both prosecuting and defending, which includes matters involving estates, trusts, and probate. He represents clients with disputes throughout the State of Florida. Attorney Adrian Philip Thomas has a Master of Laws from the University of Miami, a Juris Doctor from Nova Southeastern University, and a Bachelor of Science from the University of Florida. Attorney Adrian Philip Thomas has lectured at continuing legal education seminars on various probate topics.
This article is general legal information about Florida law, not legal advice, and does not create an attorney-client relationship. Consult a Florida-licensed attorney about your specific situation.
