7-5-1. Definitions -- Allowable trust companies -- Exceptions.
(1) As used in this chapter:
(a) "Business trust" means an entity engaged in a trade or business that is created by a
declaration of trust that transfers property to trustees, to be held and managed by them for the
benefit of persons holding certificates representing the beneficial interest in the trust estate and
assets.
(b) "Trust business" means, except as provided in Subsection (1)(c), a business in which
one acts in any agency or fiduciary capacity, including that of personal representative, executor,
administrator, conservator, guardian, assignee, receiver, depositary, or trustee under appointment
as trustee for any purpose permitted by law, including the definition of "trust" set forth in
Subsection 75-1-201(53).
(c) "Trust business" does not include the following means of holding funds, assets, or
other property:
(i) funds held in a client trust account by an attorney authorized to practice law in this
state;
(ii) funds held in connection with the purchase or sale of real estate by a person
authorized to act as a real estate broker in this state;
(iii) funds or other assets held in escrow by a person authorized by the department in
accordance with Chapter 22 or by the Utah Insurance Department to act as an escrow agent in
this state;
(iv) funds held by a homeowners' association or similar organization to pay maintenance
and other related costs for commonly owned property;
(v) funds held in connection with the collection of debts or payments on loans by a
person acting solely as the agent or representative or otherwise at the sole direction of the person
to which the debt or payment is owed, including funds held by an escrow agent for payment of
taxes or insurance;
(vi) funds and other assets held in trust on an occasional or isolated basis by a person
who does not represent that he is engaged in the trust business in Utah;
(vii) funds or other assets found by a court to be held in an implied, resulting, or
constructive trust;
(viii) funds or other assets held by a court appointed conservator, guardian, receiver,
trustee, or other fiduciary if:
(A) the conservator, receiver, guardian, trustee, or other fiduciary is responsible to the
court in the same manner as a personal representative under Title 75, Chapter 3, Part 5,
Supervised Administration, or as a receiver under Rule 66, Utah Rules of Civil Procedure;
(B) the conservator, trustee, or other fiduciary is a certified public accountant or has
qualified for and received a designation as a certified financial planner, chartered financial
consultant, certified financial analyst, or similar designation suitable to the court, that evidences
the conservator's, trustee's, or other fiduciary's professional competence to manage financial
matters;
(C) no trust company is willing or eligible to serve as conservator, guardian, trustee, or
receiver after notice has been given pursuant to Section 75-1-401 to all trust companies doing
business in this state, including a statement of the value of the assets to be managed. That notice
need not be provided, however, if a trust company has been employed by the fiduciary to manage
the assets; and
(D) in the event guardianship services are needed, the person seeking appointment as a
guardian under this Subsection (1) is a specialized care professional, as that term is defined in
Section 75-5-311, or a business or state agency that employs the services of one of those
professionals for the purpose of caring for the incapacitated person, so long as the specialized
care professional, business, or state agency does not:
(I) profit financially or otherwise from, or receive compensation for acting in that
capacity, except for the direct costs of providing guardianship or conservatorship services; or
(II) otherwise have a conflict of interest in providing those services;
(ix) funds or other assets held by a credit services organization operating in compliance
with Title 13, Chapter 21, Credit Services Organizations Act;
(x) funds, securities, or other assets held in a customer account in connection with the
purchase or sale of securities by a regulated securities broker, dealer, or transfer agent; or
(xi) funds, assets, and other property held in a business trust for the benefit of holders of
certificates of beneficial interest if the fiduciary activities of the business trust are merely
incidental to conducting business in the business trust form.
(d) "Trust company" means an institution authorized to engage in the trust business under
this chapter. Only the following may be a trust company:
(i) a Utah depository institution or its wholly owned subsidiary;
(ii) an out-of-state depository institution authorized to engage in business as a depository
institution in Utah or its wholly owned subsidiary;
(iii) a corporation, including a credit union service organization, owned entirely by one
or more federally insured depository institutions as defined in Subsection 7-1-103(8);
(iv) a direct or indirect subsidiary of a depository institution holding company that also
has a direct or indirect subsidiary authorized to engage in business as a depository institution in
Utah; and
(v) any other corporation continuously and lawfully engaged in the trust business in this
state since before July 1, 1981.
(2) Only a trust company may engage in the trust business in this state.
(3) The requirements of this chapter do not apply to:
(a) an institution authorized to engage in a trust business in another state that is engaged
in trust activities in this state solely to fulfill its duties as a trustee of a trust created and
administered in another state;
(b) a national bank, federal savings bank, federal savings and loan association, or federal
credit union authorized to engage in business as a depository institution in Utah, or any wholly
owned subsidiary of any of these, to the extent the institution is authorized by its primary federal
regulator to engage in the trust business in this state; or
(c) a state agency that is otherwise authorized by statute to act as a conservator, receiver,
guardian, trustee, or in any other fiduciary capacity.
Amended by Chapter 301, 2003 General Session
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Last revised: Thursday, May 28, 2009