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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
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
Section 99. Effective date. This Act takes effect upon
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