Legislation

Search OpenLegislation Statutes
This entry was published on 2014-09-22
The selection dates indicate all change milestones for the entire volume, not just the location being viewed. Specifying a milestone date will retrieve the most recent version of the location before that date.
SECTION 154
Transfer of fiduciary relationships from affiliated banks or trust companies to subsidiary trust companies
Banking (BNK) CHAPTER 2, ARTICLE 3-B
§ 154. Transfer of fiduciary relationships from affiliated banks or
trust companies to subsidiary trust companies. 1. (a) At any time or
times after the issuance to it by the superintendent of the
authorization certificate specified in article two of this chapter, a
subsidiary trust company may apply by verified petition to the supreme
court, special term, in and for the county in which its principal office
is located requesting that it be substituted for each of its affiliated
banks or trust companies specified in the petition (i) in every existing
fiduciary capacity designated therein and (ii) in the case of the first
such petition, in every fiduciary capacity which may take effect after
the date of the hearing provided for below. Each such specified
affiliated bank or trust company shall join in such petition. Notice of
the filing of such petition shall be given prior to the filing thereof
to the superintendent.

(b) Such petition shall indicate the county wherein the principal
office of each affiliated bank or trust company joining in the petition
is located and shall designate each fiduciary relationship existing at
the date thereof with respect to which such subsidiary trust company
requests substitution. Such petition shall additionally set forth, with
regard to each existing fiduciary relationship designated therein, the
name and address last known to the petitioner of each person entitled to
receive notice of hearing thereon, to wit:

(i) in the case where an affiliated bank or trust company specified in
the petition is acting with one or more cofiduciaries in respect to such
fiduciary relationship, each such cofiduciary; and

(ii) in the case where the instrument creating such fiduciary
relationship so provides, each person who, alone or together with
others, is empowered to revoke, terminate or amend such instrument or to
remove the corporate fiduciary; and

(iii) in the case of any fiduciary relationship not specified in
subparagraph (ii) of this paragraph, each beneficiary currently
receiving income and any other beneficiary interested in the income and
any person presumptively entitled to share in distributions of principal
were such fiduciary relationship terminated at the date of such
petition; and

(iv) in the case of any fiduciary relationship, including those
specified in subparagraphs (i), (ii) and (iii) of this paragraph, which
is an estate of a deceased person or which is a guardianship or
conservatorship, the clerk of the court in which such estate,
guardianship or conservatorship matter is pending, together with a
statement that a notice has been, or is being, given to the persons
specified in such subparagraphs. If any of the persons specified in
subparagraph (i), (ii) or (iii) of this paragraph is an infant or an
incompetent, such notice shall be given to the guardian or committee, as
the case may be, of his property. If any such infant, or incompetent
shall not have a guardian or committee to so represent him, or if any of
the persons specified in subparagraph (i), (ii) or (iii) of this
paragraph is incapacitated, unknown (or a person whose whereabouts are
unknown) or confined as a prisoner in a penal institution, the court
may, in its discretion, appoint one or more guardians ad litem to
represent any one or more of such persons.

2. When any petition described in subdivision one of this section
shall have been filed, the supreme court for the county where filed
shall enter an order fixing a date and time for hearing thereon, which
date shall not be less than thirty-five days after the filing of the
petition, and approving the form of notice to be given by the petitioner
as hereinafter provided. At least twenty-five days prior to the hearing
date, the petitioner shall cause a copy of such notice to be mailed by
first class mail to each person identified in the petition as being
entitled to receive notice under the provisions of this article, at such
person's address last known to the petitioner as set forth in the
petition. In addition, the petitioner shall cause a copy of such notice
to be published at least once a week for three successive weeks
preceding the hearing date, the first such publication to be at least
twenty-five days prior to the hearing date, such publication to be in a
newspaper of general circulation published in each county in which the
principal office of an affiliated bank or trust company specified in the
petition is located, or if in any case there be no such newspaper, then
in a newspaper of general circulation published in a contiguous county.

3. The notice to be mailed and published with respect to each such
petition shall state (a) the time and place of the hearing thereon, (b)
the name of the subsidiary trust company which has filed the petition,
(c) the name of each affiliated bank or trust company which has joined
in such petition, (d) that the petition requests that the subsidiary
trust company be substituted for each of its affiliated banks or trust
companies specified in the petition in every existing fiduciary capacity
designated therein and, if appropriate, in every fiduciary capacity
which may take effect after such hearing, and (e) that any person to
whom such notice is addressed may file an objection as provided in, and
in accordance with, subdivision four of this section. All costs incurred
in connection with the printing, mailing and publishing of such notice
shall be borne by the petitioner.

4. Any person entitled to receive notice under the provisions of this
article may, as to the fiduciary relationship by which he is affected,
object to the substitution of the subsidiary trust company as fiduciary.
Any such person wishing to so object must file a written objection to
such substitution, setting forth the reasons therefor, with the clerk of
the court in which the hearing is to be held, and serve a copy thereof
upon the attorney for the petitioner, at least three days before the
date of hearing and must appear at such hearing in person or by
attorney.

5. On the date fixed for the hearing on such petition, upon making a
determination that notice has been properly given as required by this
section, the said supreme court shall enter an order substituting the
subsidiary trust company for each of its specified affiliated banks or
trust companies in every designated existing fiduciary capacity and, in
the case of the first petition by the petitioner, in every fiduciary
capacity which may take effect thereafter, excepting fiduciary
capacities in any existing relationship with respect to which an
objection has been filed pursuant to and in accordance with subdivision
four of this section; provided, that in the case of a fiduciary
relationship where more than one person would be entitled under this
article to object to substitution of the subsidiary trust company, the
properly made objection by less than all of such persons shall be
considered by the court which shall, in its sole discretion, determine
whether such substitution shall be so ordered. In the case of a
fiduciary relationship in which an objection has been properly made by
any person who is entitled pursuant to this article to object to such
substitution, the court may, in its discretion, determine that the
resignation of the affiliated bank or trust company will be accepted in
respect of such fiduciary relationship; if the court shall determine
that such resignation will be accepted, it shall enter an order
substituting a different banking institution or subsidiary trust
company, which shall have given its written consent to such substitution
prior to the entry of such order. In construing the language of any
instrument which is the subject of a proceeding pursuant to this
article, nothing contained herein shall be considered to abrogate or
affect the intent or written language of the instrument creating the
fiduciary relationship. Upon entry of the court's order, the subsidiary
trust company shall, without further act, be substituted in every such
fiduciary capacity.

6. In respect of each fiduciary capacity, existing and future, as to
which substitution has been ordered pursuant to this article, each
designation of a petitioning affiliated bank or trust company as
fiduciary in any capacity contained in any contract, will or other
document or instrument shall be deemed a designation of the subsidiary
trust company substituted for such bank or trust company pursuant to
this section. Any grant in any such contract, will or other document or
instrument of any rights, powers, duties or authorities, whether or not
discretionary, shall be deemed conferred upon the subsidiary trust
company deemed designated as the fiduciary pursuant to this section.

7. Upon substitution pursuant to this section, each affiliated bank or
trust company shall deliver to the subsidiary trust company all assets
held by such trust company as fiduciary (except assets held in
capacities with respect to which there has been no substitution pursuant
to this section) and upon such substitution all such assets shall become
the property of the subsidiary trust company without the necessity of
any instrument of transfer or conveyance. A trust company shall account,
in respect of each of its existing fiduciary relationships designated in
the petition and as to which a substitution has been ordered under this
section, for that portion of the accounting period in which such
substitution was ordered ending on the date of such order; thereafter
the subsidiary trust company which has been substituted as fiduciary for
such bank or trust company shall account in respect of each such
fiduciary relationship. Notwithstanding any provision in this chapter to
the contrary, after a substitution of existing fiduciary capacities
pursuant to this article, an affiliated bank or trust company shall
remain jointly liable with the subsidiary trust company which has been
substituted for it in respect of each of the existing fiduciary
relationships as to which such substitution has been ordered, but such
affiliated bank or trust company shall be entitled to a right of
subrogation against such subsidiary trust company for all amounts paid
by such affiliated bank or trust company as a result of such joint
liability.