State of Illinois
91^st General Assembly
Public Acts

Public Act 91-0433

HB1286 Enrolled                               LRB9102550LDpkA

    AN ACT to create the Land Trust Fiduciary Duties Act.

    Be it enacted by the People of  the  State  of  Illinois,
represented in the General Assembly:

    Section  1.  Short  title.   This Act may be cited as the
Land Trust Fiduciary Duties Act.

    Section 5. Legislative finding; purpose.
    (a)  The  General  Assembly  finds  that   the   Illinois
judiciary  system  and  the  federal  judiciary  system  have
unclear  court  decisions  as  to  whether the holders of the
power of direction have fiduciary duties to  the  holders  of
the  beneficial  interest  in  land  trusts.  The terms "land
trust" and "beneficial interest" have the  same  meanings  as
defined in Section 2 of the Land Trustee as Creditor Act.
    (b)  It  is  the  purpose  of  this  Act  to clarify that
holders of the power of  direction  are  accountable  to  the
holders   of  the  beneficial  interest  in  land  trusts  as
declaratory of existing law.

    Section  10.  Holders  of   the   power   of   direction;
definition.  "Holders  of  the  power of direction" means the
persons or  entities  having  the  authority  to  direct  the
trustee to convey, execute a mortgage, distribute proceeds of
sale  or  financing,  and execute documents incidental to the
execution of a land trust.

    Section 15.  Fiduciary duties of holders of the power  of
direction.  The power of direction, unless provided otherwise
in  the  land  trust agreement, is conferred upon the holders
thereof for the use and benefit of all of the holders of  the
beneficial  interest  in  the  land trust.  In exercising the
power of direction, the holders are  presumed  to  act  in  a
fiduciary  capacity  for  the  benefit  of all holders of the
beneficial interest in the trust, unless  otherwise  provided
in  the  land trust agreement.  The beneficial interest shall
be indefeasible and the power of direction shall  not  be  so
exercised  to  alter,  amend,  revoke,  terminate, defeat, or
otherwise affect or change the enjoyment  of  any  beneficial
interest.

    Section 20.  Application of Act.  This Act is declaratory
of  existing  law  and  is  intended  to  remove any possible
conflicts or  ambiguities, thereby  confirming  the  existing
law  pertinent  to  land  trusts  and shall apply to all land
trusts in effect before, on, or after the effective  date  of
this Act.

    Section  99.  Effective date.  This Act takes effect upon
becoming law.