Appendix IV. New York State Prudent Investor Act

• Author: Seymour Goldberg
• Profession: Senior partner in the law firm of Goldberg & Goldberg, PC in Woodbury, New York
• Pages: 149-157

APPENDIX IV

NEW YORK STATE

PRUDENT INVESTOR ACT

149

Contains Power to Adjust Provision—Section 11–2.3(b)(5)

Technical corrections to the law may be made from time to time to

clarify the law or to make changes to the law. Caution: You must periodi-

cally review the law to make sure that no changes were made.

*§ 11–2.3. Prudent investor act

(a) Prudent investor rule.

A trustee has a duty to invest and manage property held in a duciary

capacity in accordance with the prudent investor standard dened

by this section, except as otherwise provided by the express terms

and provisions of a governing instrument within the limitations

set forth by section 11–1.7 of this chapter. This section shall apply

to any investment made or held on or after January rst, nineteen

hundred ninety-ve by a trustee.

(b) Prudent investor standard.

(1)

The prudent investor rule requires a standard of conduct,

not outcome or performance. Compliance with the prudent

investor rule is determined in light of facts and circumstances

prevailing at the time of the decision or action of a trustee.

A trustee is not liable to a beneciary to the extent that the

trustee acted in substantial compliance with the prudent inves-

tor standard or in reasonable reliance on the express terms and

provisions of the governing instrument.

(2)

A trustee shall exercise reasonable care, skill and caution to

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