[Rev. 6/29/2024 3:07:38 PM--2023]

CHAPTER 162 - FIDUCIARIES

UNIFORM ACT

NRS 162.010           Short title.

NRS 162.020           Definitions.

NRS 162.030           Application of payment made to fiduciary.

NRS 162.050           Transfer of negotiable instrument by fiduciary.

NRS 162.060           Check drawn by fiduciary payable to third person.

NRS 162.070           Check drawn by and payable to fiduciary.

NRS 162.080           Deposit in name of fiduciary as such.

NRS 162.090           Check drawn upon account of principal.

NRS 162.100           Deposit in personal account of fiduciary.

NRS 162.110           Deposit in names of two or more trustees.

NRS 162.120           Applicability.

NRS 162.130           Cases not provided for in NRS 162.010 to 162.140, inclusive.

NRS 162.140           Uniformity of interpretation.

ACT FOR SIMPLIFICATION OF FIDUCIARY SECURITY TRANSFERS

NRS 162.150           Short title.

NRS 162.160           Definitions.

NRS 162.170           Registration in name of fiduciary.

NRS 162.180           Assignment by fiduciary.

NRS 162.210           Nonliability of corporation and transfer agent.

NRS 162.220           Nonliability of third person.

NRS 162.230           Application of NRS 162.150 to 162.250, inclusive.

NRS 162.240           Tax obligations.

NRS 162.250           Uniformity of interpretation.

MISCELLANEOUS PROVISIONS

NRS 162.260           Succession to powers and duties of original fiduciary.

NRS 162.270           Continued administration by surviving fiduciary.

NRS 162.280           Withholding of property from beneficiary.

NRS 162.300           Establishment of trust or formation of entity by fiduciary; transfer, assignment or conveyance of estate or trust property to trust or entity; ownership or control of trust or entity by trust.

NRS 162.310           Limitation on duty of attorney representing fiduciary with respect to principal.

_________

UNIFORM ACT

      NRS 162.010  Short title.  NRS 162.010 to 162.140, inclusive, may be cited as the Uniform Fiduciaries Act.

      [14:44:1923; NCL § 2998]—(NRS A 1959, 605)

      NRS 162.020  Definitions.

      1.  In NRS 162.010 to 162.140, inclusive, unless the context of subject matter otherwise requires:

      (a) “Bank” includes any person or association of persons, whether incorporated or not, carrying on the business of banking.

      (b) “Fiduciary” includes a trustee under any trust, expressed, implied, resulting or constructive, executor, administrator, guardian, conservator, curator, receiver, trustee in bankruptcy, assignee for the benefit of creditors, partner, agent, officer of a corporation, public or private, public officer, or any other person acting in a fiduciary capacity for any person, trust or estate.

      (c) “Principal” includes any person to whom a fiduciary as such owes an obligation.

      2.  A thing is done “in good faith” within the meaning of NRS 162.010 to 162.140, inclusive, when it is in fact done honestly, whether it is done negligently or not.

      [1:44:1923; NCL § 2985]—(NRS A 1985, 508)

      NRS 162.030  Application of payment made to fiduciary.  A person who in good faith pays or transfers to a fiduciary any money or other property which the fiduciary as such is authorized to receive, is not responsible for the proper application thereof by the fiduciary; and any right or title acquired from the fiduciary in consideration of such payment or transfer is not invalid in consequence of a misapplication by the fiduciary.

      [2:44:1923; NCL § 2986]

      NRS 162.050  Transfer of negotiable instrument by fiduciary.  If any negotiable instrument payable or endorsed to a fiduciary as such is endorsed by the fiduciary, or if any negotiable instrument payable or endorsed to his or her principal is endorsed by a fiduciary empowered to endorse such instrument on behalf of the principal, the endorsee is not bound to inquire whether the fiduciary is committing a breach of his or her obligation as fiduciary in endorsing or delivering the instrument, and is not chargeable with notice that the fiduciary is committing a breach of his or her obligation as fiduciary unless the endorsee takes the instrument with actual knowledge of such breach or with knowledge of such facts that this action in taking the instrument amounts to bad faith. If, however, such instrument is transferred by the fiduciary in payment of or as security for a personal debt of the fiduciary to the actual knowledge of the creditor, or is transferred in any transaction known by the transferee to be for the personal benefit of the fiduciary, the creditor or other transferee is liable to the principal if the fiduciary in fact commits a breach of his or her obligation as fiduciary in transferring the instrument.

      [4:44:1923; NCL § 2988]

      NRS 162.060  Check drawn by fiduciary payable to third person.  If a check or other bill of exchange is drawn by a fiduciary as such, or in the name of his or her principal by a fiduciary empowered to draw such instrument in the name of the principal, the payee is not bound to inquire whether the fiduciary is committing a breach of his or her obligation as fiduciary in drawing or delivering the instrument, and is not chargeable with notice that the fiduciary is committing a breach of his or her obligation as fiduciary unless the payee takes the instrument with actual knowledge of such breach or with knowledge of such facts that this action in taking the instrument amounts to bad faith. If, however, such instrument is payable to a personal creditor of the fiduciary and delivered to the creditor in payment of or as security for a personal debt of the fiduciary to the actual knowledge of the creditor, or is drawn and delivered in any transaction known by the payee to be for the personal benefit of the fiduciary, the creditor or other payee is liable to the principal if the fiduciary in fact commits a breach of his or her obligation as fiduciary in drawing or delivering the instrument.

      [5:44:1923; NCL § 2989]

      NRS 162.070  Check drawn by and payable to fiduciary.  If a check or other bill of exchange is drawn by a fiduciary as such or in the name of his or her principal by a fiduciary empowered to draw such instrument in the name of the principal, payable to the fiduciary personally, or payable to a third person and transferred by the third person to the fiduciary, and is thereafter transferred by the fiduciary, whether in payment of a personal debt of the fiduciary or otherwise, the transferee is not bound to inquire whether the fiduciary is committing a breach of his or her obligation as fiduciary in transferring the instrument, and is not chargeable with notice that the fiduciary is committing a breach of his or her obligation as fiduciary unless the transferee takes the instrument with actual knowledge of such breach or with knowledge of such facts that this action in taking the instrument amounts to bad faith.

      [6:44:1923; NCL § 2990]

      NRS 162.080  Deposit in name of fiduciary as such.  If a deposit is made in a bank to the credit of a fiduciary as such, the bank is authorized to pay the amount of the deposit or any part thereof upon the check of the fiduciary, signed with the name in which such deposit is entered, without being liable to the principal, unless the bank pays the check with actual knowledge that the fiduciary is committing a breach of his or her obligation as fiduciary in drawing the check or with knowledge of such facts that its action in paying the check amounts to bad faith. If, however, such check is payable to the drawee bank and is delivered to it in payment of or as security for a personal debt of the fiduciary to it, the bank is liable to the principal if the fiduciary in fact commits a breach of his or her obligation as fiduciary in drawing or delivering the check.

      [7:44:1923; NCL § 2991]

      NRS 162.090  Check drawn upon account of principal.  If a check is drawn upon the account of his or her principal in a bank by a fiduciary who is empowered to draw checks upon the principal’s account, the bank is authorized to pay such check without being liable to the principal, unless the bank pays the check with actual knowledge that the fiduciary is committing a breach of his or her obligation as fiduciary in drawing such check, or with knowledge of such facts that its action in paying the check amounts to bad faith. If, however, such a check is payable to the drawee bank and is delivered to it in payment of or as security for a personal debt of the fiduciary to it, the bank is liable to the principal if the fiduciary in fact commits a breach of his or her obligation as fiduciary in drawing or delivering the check.

      [8:44:1923; NCL § 2992]

      NRS 162.100  Deposit in personal account of fiduciary.  If a fiduciary makes a deposit in a bank to his or her personal credit of checks drawn by the fiduciary upon an account in his or her own name as fiduciary, or of checks payable to him or her as fiduciary, or of checks drawn by the fiduciary upon an account in the name of his or her principal if the fiduciary is empowered to draw checks thereon, or of checks payable to his or her principal and endorsed by the fiduciary, if the fiduciary is empowered to endorse such checks, or if the fiduciary otherwise makes a deposit of funds held by him or her as fiduciary, the bank receiving such deposit is not bound to inquire whether the fiduciary is committing thereby a breach of his or her obligation as fiduciary; and the bank is authorized to pay the amount of the deposit or any part thereof upon the personal check of the fiduciary without being liable to the principal, unless the bank receives the deposit or pays the check with actual knowledge that the fiduciary is committing a breach of his or her obligation as fiduciary in making such deposit or in drawing such check, or with knowledge of such facts that its action in receiving the deposit or paying the check amounts to bad faith.

      [9:44:1923; NCL § 2993]

      NRS 162.110  Deposit in names of two or more trustees.  When a deposit is made in a bank in the name of two or more persons as trustees and a check is drawn upon the trust account by any trustee or trustees authorized by the other trustee or trustees to draw checks upon the trust account, neither the payee nor other holder nor the bank is bound to inquire whether it is a breach of trust to authorize such trustee or trustees to draw checks upon the trust account, and neither the payee nor other holder nor the bank shall be liable unless the circumstances be such that the action of the payee or other holder or the bank amounts to bad faith.

      [10:44:1923; NCL § 2994]

      NRS 162.120  Applicability.  The provisions of NRS 162.010 to 162.140, inclusive, shall not apply to transactions taking place prior to March 1, 1923.

      [11:44:1923; NCL § 2995]

      NRS 162.130  Cases not provided for in NRS 162.010 to 162.140, inclusive.  In any case not provided for in NRS 162.010 to 162.140, inclusive, the rules of law and equity, including the law merchant and those rules of law and equity relating to trusts, agency, negotiable instruments and banking, shall continue to apply.

      [12:44:1923; NCL § 2996]

      NRS 162.140  Uniformity of interpretation.  NRS 162.010 to 162.140, inclusive, shall be so interpreted and construed as to effectuate their general purpose to make uniform the law of those states which enact them.

      [13:44:1923; NCL § 2997]

ACT FOR SIMPLIFICATION OF FIDUCIARY SECURITY TRANSFERS

      NRS 162.150  Short title.  NRS 162.150 to 162.250, inclusive, may be cited as the Act for Simplification of Fiduciary Security Transfers.

      (Added to NRS by 1959, 605)

      NRS 162.160  Definitions.  As used in NRS 162.150 to 162.250, inclusive, unless the context otherwise requires:

      1.  “Assignment” includes any written stock power, bond power, bill of sale, deed, declaration of trust or other instrument of transfer.

      2.  “Claim of beneficial interest” includes a claim of any interest by a decedent’s legatee, distributee, heir or creditor, a beneficiary under a trust, a protected person, a beneficial owner of a security registered in the name of a nominee, or a minor owner of a security registered in the name of a custodian, or a claim of any similar interest, whether the claim is asserted by the claimant or by a fiduciary or by any other authorized person on his or her behalf, and includes a claim that the transfer would be in breach of fiduciary duties.

      3.  “Corporation” means a private or public corporation, association or trust issuing a security.

      4.  “Fiduciary” means an executor, administrator, trustee, guardian, committee, conservator, curator, tutor, custodian or nominee.

      5.  “Person” includes a government, a governmental agency and a political subdivision of a government.

      6.  “Security” includes any share of stock, bond, debenture, note or other security issued by a corporation which is registered as to ownership on the books of the corporation.

      7.  “Transfer” means a change on the books of a corporation in the registered ownership of a security.

      8.  “Transfer agent” means a person employed or authorized by a corporation to transfer securities issued by the corporation.

      (Added to NRS by 1959, 603; A 1985, 509)

      NRS 162.170  Registration in name of fiduciary.  A corporation or transfer agent registering a security in the name of a person who is a fiduciary or who is described as a fiduciary is not bound to inquire into the existence, extent or correct description of the fiduciary relationship, and thereafter the corporation and its transfer agent may assume without inquiry that the newly registered owner continues to be the fiduciary until the corporation or transfer agent receives written notice that the fiduciary is no longer acting as such with respect to the particular security.

      (Added to NRS by 1959, 603)

      NRS 162.180  Assignment by fiduciary.  Except as otherwise provided in NRS 162.150 to 162.250, inclusive, a corporation or transfer agent making a transfer of a security pursuant to an assignment by a fiduciary:

      1.  May assume without inquiry that the assignment, even though to the fiduciary or to a nominee of the fiduciary, is within his or her authority and capacity and is not in breach of his or her fiduciary duties.

      2.  May assume without inquiry that the fiduciary has complied with any controlling instrument and with the law of the jurisdiction governing the fiduciary relationship, including any law requiring the fiduciary to obtain court approval of the transfer.

      3.  Is not charged with notice of and is not bound to obtain or examine any court record or any recorded or unrecorded document relating to the fiduciary relationship or the assignment, even though the record or document is in its possession.

      (Added to NRS by 1959, 604)

      NRS 162.210  Nonliability of corporation and transfer agent.  A corporation or transfer agent incurs no liability to any person by making a transfer or otherwise acting in a manner authorized by NRS 162.150 to 162.250, inclusive.

      (Added to NRS by 1959, 605)

      NRS 162.220  Nonliability of third person.

      1.  No person who participates in the acquisition, disposition, assignment or transfer of a security by or to a fiduciary, including a person who guarantees the signature of the fiduciary, is liable for participation in any breach of fiduciary duty by reason of failure to inquire whether the transaction involves such a breach unless it is shown that the person acted with actual knowledge that the proceeds of the transaction were being or were to be used wrongfully for the individual benefit of the fiduciary or that the transaction was otherwise in breach of duty.

      2.  If a corporation or transfer agent makes a transfer pursuant to an assignment by a fiduciary, a person who guaranteed the signature of the fiduciary is not liable on the guarantee to any person to whom the corporation or transfer agent by reason of the provisions of NRS 162.150 to 162.250, inclusive, incurs no liability.

      3.  This section does not impose any liability upon the corporation or its transfer agent.

      (Added to NRS by 1959, 605)

      NRS 162.230  Application of NRS 162.150 to 162.250, inclusive.  The provisions of NRS 162.150 to 162.250, inclusive, apply to the rights and duties of a person other than the issuing corporation and its transfer agents with regard to acts and omission in this state in connection with the acquisition, disposition, assignment or transfer of a security by or to a fiduciary and of a person who guarantees in this state the signature of a fiduciary in connection with such a transaction.

      (Added to NRS by 1959, 605; A 1997, 420)

      NRS 162.240  Tax obligations.  NRS 162.150 to 162.250, inclusive, do not affect any obligation of a corporation or transfer agent with respect to any taxes imposed by the laws of this state.

      (Added to NRS by 1959, 605)

      NRS 162.250  Uniformity of interpretation.  NRS 162.150 to 162.250, inclusive, shall be so construed as to effectuate their general purpose to make uniform the law of those states which enact them.

      (Added to NRS by 1959, 605)

MISCELLANEOUS PROVISIONS

      NRS 162.260  Succession to powers and duties of original fiduciary.  A successor or substitute fiduciary succeeds to all the powers and duties which the will, deed or other instrument conferred on the original fiduciary with respect to the estate or trust unless the instrument expressly prohibits a successor or substitute from succeeding to those powers and duties.

      (Added to NRS by 1979, 455)

      NRS 162.270  Continued administration by surviving fiduciary.  The survivor of two or more fiduciaries may continue to administer the property of the estate or trust without the appointment of a successor unless the continued administration by the survivor is contrary to an express provision of the will, deed or other instrument governing the estate or trust.

      (Added to NRS by 1979, 455)

      NRS 162.280  Withholding of property from beneficiary.  At the time for distribution of any property of an estate or trust, the fiduciary may withhold any part or all of the property from the beneficiaries if the fiduciary determines that the property may be subject to claims of offset held by the fiduciary in his or her fiduciary capacity, conflicting claims, tax deficiencies or other liabilities, contingent or otherwise, relating to the estate or trust.

      (Added to NRS by 1979, 455; A 2017, 1685)

      NRS 162.300  Establishment of trust or formation of entity by fiduciary; transfer, assignment or conveyance of estate or trust property to trust or entity; ownership or control of trust or entity by trust.

      1.  A fiduciary may establish a trust or form a corporation, limited-liability company or other entity, and transfer, assign and convey to the trust, corporation, limited-liability company or entity all or any part of an estate or of any trust property in exchange for the stock, securities or obligations of the trust, corporation, limited-liability company or entity, and continue to hold the stock and securities and obligations.

      2.  A trust established or a corporation, limited-liability company or other entity incorporated, organized or registered under the laws of this State that acts as a fiduciary or trustee of an estate or trust administered under the laws of this State may be owned or controlled by the trust if the trust instrument authorizes the trust to own an affiliate.

      3.  As used in this section, “affiliate” has the meaning ascribed to it in NRS 163.020.

      (Added to NRS by 2005, 537; A 2017, 1685)

      NRS 162.310  Limitation on duty of attorney representing fiduciary with respect to principal.

      1.  An attorney who represents a fiduciary does not, solely as a result of such attorney-client relationship, assume a corresponding duty of care or other fiduciary duty to a principal.

      2.  Nothing in this section limits a principal, fiduciary or successor fiduciary’s ability to assert appropriate claims against the attorney resulting from the negligent or intentional acts of the attorney.

      3.  As used in this section:

      (a) “Fiduciary” has the meaning ascribed to it in NRS 162.020.

      (b) “Principal” has the meaning ascribed to it in NRS 162.020.

      (Added to NRS by 2011, 1465)