9-2107.Allowing for the contracting for trust services; definitions;
notice filing; authority of commissioner; fees; examination; branches.
(a) As used in this section:
(1) "Contracting trustee" means any trust company, as defined in K.S.A.
9-701, and amendments thereto, any bank that has been granted trust
authority by the state bank commissioner under K.S.A. 9-1602, and amendments
thereto,
or any national bank chartered to do business in Kansas that has been
granted trust authority by the comptroller
of the currency under 12 USC 92a, or any bank that has been granted trust
authority or any trust company, regardless of where such bank or trust
company is located,
and which is controlled, as
defined in
K.S.A. 9-1612, and amendments thereto, by the same bank holding
company as any
trust company, state bank or national bank chartered to do business in
Kansas,
which accepts or succeeds to any fiduciary
responsibility as provided in this
section;
(2) "originating trustee" means any trust company, bank, national
banking association, savings and loan association or savings bank which has
trust powers and its principal place of business is in this state and which
places or transfers any fiduciary responsibility to a contracting trustee as
provided in this section;
(3) "financial institution" means any bank, national banking association,
savings and loan association or savings bank which has its principal place of
business in this state but which does not have trust powers.
(b) Any contracting trustee and any originating trustee may enter into
an agreement by which the contracting trustee, without any
further authorization of any kind, succeeds to and is
substituted for the originating trustee as to all fiduciary powers, rights,
duties, privileges
and liabilities with respect to all accounts for which the originating
trustee serves in any fiduciary capacity, except as may be provided
otherwise in the agreement.
Notwithstanding the provisions of this section, no contracting trustee as
defined in K.S.A. 9-2107(a)(1), and amendments thereto, having its home
office
outside the state of Kansas shall enter into an agreement except with an
originating trustee which is commonly controlled as defined in K.S.A.
9-1612,
and amendments thereto, by the same bank holding company.
(c) Unless the agreement expressly provides otherwise, upon the
effective date of the substitution:
(1) The contracting trustee shall be deemed to be named as the fiduciary
in all writings, including, without limitation, trust agreements, wills and
court orders, which pertain to the affected fiduciary accounts;
(2) the originating trustee is absolved from all fiduciary
duties
and obligations arising under such writings and shall discontinue the
exercise of any fiduciary duties with respect to such writings, except that
the originating trustee is not absolved or discharged from
any duty to account required by K.S.A. 59-1709, and
amendments thereto, or any other
applicable statute, rule of law, rules and
regulations or court order, nor shall the
originating trustee be absolved from any breach of fiduciary duty or
obligation occurring prior to the effective date of the agreement.
(d) The agreement may authorize the contracting trustee:
(1) To establish a trust service desk at any office of
the originating trustee at which the contracting trustee may conduct any
trust business and any business incidental thereto and which the
contracting trustee may otherwise conduct at its principal place of business;
and
(2) to engage the originating trustee as the agent of the contracting
trustee, on a disclosed basis to customers, for the purposes of providing
administrative, advertising and safekeeping services incident to the
fiduciary services provided by the contracting trustee.
(e) Any contracting trustee may enter into an agreement with a
financial institution providing that the contracting trustee may
establish a trust service desk as authorized by subsection (d) in the
offices of such
financial institution and which provides such financial institution, on a
disclosed basis to customers, may act as the agent of contracting trustee
for purposes of providing administrative services and advertising incident
to the fiduciary services to be performed by the contracting trustee.
(f) No activity authorized by subsections (b)
through (e) shall be conducted by any contracting trustee, originating trustee
or financial institution until an application for such authority has been
submitted to and approved by the commissioner. The application shall be in the
form and contain the information required by the commissioner, which shall at a
minimum include certified copies of the following documents:
(1) The agreement;
(2) the written action taken by the board of directors of the
originating trustee or financial institution approving the agreement;
(3) all other required regulatory approvals;
(4) an affidavit of publication of notice of intent to
file the application with the commissioner.
Publication of the notice shall be
on the same day for two consecutive
weeks in the official newspaper of the city or county where the principal
office of the originating trustee or financial institution is located.
The notice shall be in the form prescribed by the commissioner and shall
contain the name of the applicant contracting trustee, the originating trustee
or financial institution, the proposed date of filing of the application with
the commissioner, a solicitation for written comments concerning the
application, and a notice of the public's right to file a written request for a
public hearing for the purpose of presenting oral or written evidence regarding
the proposed agreement. All comments and requests for public hearing shall be
filed with the commissioner on or before the 30th day after the date the
application is filed; and
(5) a certification by the parties to the agreement that written notice of
the proposed substitution was sent by first-class mail to each cofiduciary,
each surviving settlor of a trust, each ward of a guardianship, each person who
has sole or shared power to remove the originating trustee as fiduciary and
each adult beneficiary currently receiving or entitled to receive a
distribution of principle or income from a fiduciary account
affected by the agreement, and that such notice was sent to each such person's
address as shown in the originating trustee's records. An unintentional failure
to give such notice shall not impair the validity or effect of any such
agreement, except an intentional failure to give such notice shall render the
agreement null and void as to the party not receiving the notice of
substitution.
(g) A contracting trustee making application to the commissioner for approval
of
any agreement pursuant to this section shall pay to the commissioner a fee, in
an amount established by rules and regulations of the commissioner adopted
pursuant to K.S.A. 9-1713, and amendments thereto, to defray the
expenses of the
commissioner or designee in the examination and investigation
of the application. The commissioner shall remit all amounts received under
this section to the state treasurer in
accordance
with the provisions of K.S.A. 75-4215, and amendments thereto. Upon receipt of
each such remittance, the state treasurer shall deposit the entire amount in
the state treasury to the credit of a separate
account in the state treasury for each application. The money in each such
account shall be used to pay the expenses of the commissioner, or designee
in the examination and investigation of the application to which it relates and
any unused balance shall be transferred to the bank commissioner fee fund.
(h) Upon the filing of any such application with the commissioner, the
commissioner shall make or cause to be made, a careful examination and
investigation concerning:
(1) The reasonable probability of usefulness and success of the contracting
trustee;
(2) the financial history and condition of the contracting trustee including
the character, qualifications and experience of the officers employed by the
contracting trustee; and
(3) whether the contracting agreement will result in any undue injury to
properly conducted existing banks, national banks and trust companies.
If the commissioner shall determine any of such matters unfavorably to the
applicants, the application shall be disapproved, but if not, then the
application shall be approved.
(i) If no written request for public hearing is filed, the commissioner
shall render approval or disapproval of the application within 60 days of the
date upon which the application was filed.
(j) If a written request for public hearing is filed, the commissioner shall
hold within 30 days of the close of the comment period, a public hearing in a
location determined by the commissioner. Notice of the time, date and place of
such hearing shall be published by the applicant in a newspaper of general
circulation in the county where the originating trustee or financial
institution is located, not less than 10 nor more than 30 days prior to the
date of the hearing, and an affidavit of publication shall be filed with the
commissioner. At any such hearing, all interested persons may present written
and oral evidence to the commissioner in support of or in opposition to the
application. Upon completion of a transcript of the testimony given at any
such hearing, the transcript shall be filed in the office of the commissioner.
Within 14 days after the public hearing, the commissioner shall approve or
disapprove the application after consideration of the application and evidence
gathered during the commissioner's investigation.
(k) The commissioner may extend the period for approval or disapproval if
the commissioner determines that any information required by this section has
not been furnished, any material information submitted is inaccurate or
additional investigation is required. The commissioner, prior to expiration of
the application period provided for by this section, shall give written notice
to each party to the agreement of the commissioner's intent to extend the
period which shall include a specific date for expiration of the extension
period. If any information remains incomplete or inaccurate upon the
expiration of the extension period the application shall be disapproved.
(l) Within 15 days of the date of the commissioner's approval or denial, the
applicant or any individual or corporation who filed a request for and
presented evidence at the public hearing shall have the right to appeal in
writing to the state banking board the
commissioner's determination by filing a notice of appeal with the
commissioner. The state banking board shall fix a date for hearing, which
hearing shall be
held within 45 days after such notice of appeal is filed. The board
shall conduct the hearing in accordance with the provisions of the Kansas
administrative procedure act and render its decision affirming or rescinding
the determination of the commissioner. Any action of the board pursuant to
this section is subject to review in accordance with the act for judicial
review and civil enforcement of agency actions.
Any party which files an appeal to the state banking board of the
commissioner's determination shall pay to the commissioner a fee in an amount
established by rules and regulations of the commissioner, adopted pursuant to
K.S.A. 9-1713, and amendments thereto, to defray the board's expenses
associated
with the conduct of the appeal.
(m) When the commissioner determines that any contracting trustee domiciled
in this state has entered into a contracting agreement in violation of the laws
governing the operation of such contracting trustee, the commissioner shall
give written notice to the contracting trustee and the originating trustee or
financial institution of such determination. Within 15 days after receipt of
such notification, the contracting trustee and originating trustee or financial
institution shall have the right to appeal in writing to the state banking
board the commissioner's determination. The board shall fix a date for
hearing, which shall be held within 45 days after the date of the
appeal and shall be conducted in accordance with the Kansas administrative
procedure act. At such hearing the board shall hear all matters relevant to
the commissioner's determination and shall approve or disapprove the
commissioner's determination. The decision of the board shall be final and
conclusive. If the contracting trustee does not appeal to the
board from the commissioner's determination or if an appeal is made and the
commissioner's determination is upheld by the board, the commissioner may
proceed as provided in K.S.A. 9-1714, and amendments thereto, until such
time as
the commissioner determines the contracting trustee, originating trustee and
financial institution are in full compliance with the laws governing the
operation of a contracting trustee and originating trustee or financial
institution.
(n) Any party entitled to receive a notice under subsection (f)(5) may file
a petition in the court having jurisdiction over the fiduciary relationship, or
if none, in the district court in the county where the originating trustee has
its principal office, seeking to remove any contracting trustee substituted or
about to be substituted as fiduciary pursuant to this section. Unless the
contracting trustee files a written consent to its removal or a written
declination to act subsequent to the filing of the petition, the court, upon
notice and hearing, shall determine the best interest of the petitioner and all
other parties concerned and shall fashion such relief as it deems appropriate
in the circumstances, including the awarding of reasonable attorney fees. The
right to file a petition under this subsection shall be in addition to any
other rights to remove fiduciary provided by any other statute or regulation or
by the writing creating the fiduciary relationship. If the removal of the
fiduciary is prompted solely as a result of the contracting agreement, any
reasonable cost associated with such removal and transfer, not to exceed $200
per account, shall be paid by the originating trustee or financial institution
entering into the agreement.
History: L. 1989, ch. 48, § 7;
L. 1990, ch. 60, § 3;
L. 1993, ch. 30, § 2;
L. 1994, ch. 51, § 1;
L. 1994, ch. 294, § 1;
L. 1999, ch. 18, § 1;
L. 2001, ch. 5, § 48; July 1.
9-2107.Allowing for the contracting for trust services; definitions;
notice filing; authority of commissioner; fees; examination; branches.
(a) As used in this section:
(1) "Contracting trustee" means any trust company, as defined in K.S.A.
9-701, and amendments thereto, any bank that has been granted trust
authority by the state bank commissioner under K.S.A. 9-1602, and amendments
thereto,
or any national bank chartered to do business in Kansas that has been
granted trust authority by the comptroller
of the currency under 12 USC 92a, or any bank that has been granted trust
authority or any trust company, regardless of where such bank or trust
company is located,
and which is controlled, as
defined in
K.S.A. 9-1612, and amendments thereto, by the same bank holding
company as any
trust company, state bank or national bank chartered to do business in
Kansas,
which accepts or succeeds to any fiduciary
responsibility as provided in this
section;
(2) "originating trustee" means any trust company, bank, national
banking association, savings and loan association or savings bank which has
trust powers and its principal place of business is in this state and which
places or transfers any fiduciary responsibility to a contracting trustee as
provided in this section;
(3) "financial institution" means any bank, national banking association,
savings and loan association or savings bank which has its principal place of
business in this state but which does not have trust powers.
(b) Any contracting trustee and any originating trustee may enter into
an agreement by which the contracting trustee, without any
further authorization of any kind, succeeds to and is
substituted for the originating trustee as to all fiduciary powers, rights,
duties, privileges
and liabilities with respect to all accounts for which the originating
trustee serves in any fiduciary capacity, except as may be provided
otherwise in the agreement.
Notwithstanding the provisions of this section, no contracting trustee as
defined in K.S.A. 9-2107(a)(1), and amendments thereto, having its home
office
outside the state of Kansas shall enter into an agreement except with an
originating trustee which is commonly controlled as defined in K.S.A.
9-1612,
and amendments thereto, by the same bank holding company.
(c) Unless the agreement expressly provides otherwise, upon the
effective date of the substitution:
(1) The contracting trustee shall be deemed to be named as the fiduciary
in all writings, including, without limitation, trust agreements, wills and
court orders, which pertain to the affected fiduciary accounts;
(2) the originating trustee is absolved from all fiduciary
duties
and obligations arising under such writings and shall discontinue the
exercise of any fiduciary duties with respect to such writings, except that
the originating trustee is not absolved or discharged from
any duty to account required by K.S.A. 59-1709, and
amendments thereto, or any other
applicable statute, rule of law, rules and
regulations or court order, nor shall the
originating trustee be absolved from any breach of fiduciary duty or
obligation occurring prior to the effective date of the agreement.
(d) The agreement may authorize the contracting trustee:
(1) To establish a trust service desk at any office of
the originating trustee at which the contracting trustee may conduct any
trust business and any business incidental thereto and which the
contracting trustee may otherwise conduct at its principal place of business;
and
(2) to engage the originating trustee as the agent of the contracting
trustee, on a disclosed basis to customers, for the purposes of providing
administrative, advertising and safekeeping services incident to the
fiduciary services provided by the contracting trustee.
(e) Any contracting trustee may enter into an agreement with a
financial institution providing that the contracting trustee may
establish a trust service desk as authorized by subsection (d) in the
offices of such
financial institution and which provides such financial institution, on a
disclosed basis to customers, may act as the agent of contracting trustee
for purposes of providing administrative services and advertising incident
to the fiduciary services to be performed by the contracting trustee.
(f) No activity authorized by subsections (b)
through (e) shall be conducted by any contracting trustee, originating trustee
or financial institution until an application for such authority has been
submitted to and approved by the commissioner. The application shall be in the
form and contain the information required by the commissioner, which shall at a
minimum include certified copies of the following documents:
(1) The agreement;
(2) the written action taken by the board of directors of the
originating trustee or financial institution approving the agreement;
(3) all other required regulatory approvals;
(4) an affidavit of publication of notice of intent to
file the application with the commissioner.
Publication of the notice shall be
on the same day for two consecutive
weeks in the official newspaper of the city or county where the principal
office of the originating trustee or financial institution is located.
The notice shall be in the form prescribed by the commissioner and shall
contain the name of the applicant contracting trustee, the originating trustee
or financial institution, the proposed date of filing of the application with
the commissioner, a solicitation for written comments concerning the
application, and a notice of the public's right to file a written request for a
public hearing for the purpose of presenting oral or written evidence regarding
the proposed agreement. All comments and requests for public hearing shall be
filed with the commissioner on or before the 30th day after the date the
application is filed; and
(5) a certification by the parties to the agreement that written notice of
the proposed substitution was sent by first-class mail to each cofiduciary,
each surviving settlor of a trust, each ward of a guardianship, each person who
has sole or shared power to remove the originating trustee as fiduciary and
each adult beneficiary currently receiving or entitled to receive a
distribution of principle or income from a fiduciary account
affected by the agreement, and that such notice was sent to each such person's
address as shown in the originating trustee's records. An unintentional failure
to give such notice shall not impair the validity or effect of any such
agreement, except an intentional failure to give such notice shall render the
agreement null and void as to the party not receiving the notice of
substitution.
(g) A contracting trustee making application to the commissioner for approval
of
any agreement pursuant to this section shall pay to the commissioner a fee, in
an amount established by rules and regulations of the commissioner adopted
pursuant to K.S.A. 9-1713, and amendments thereto, to defray the
expenses of the
commissioner or designee in the examination and investigation
of the application. The commissioner shall remit all amounts received under
this section to the state treasurer in
accordance
with the provisions of K.S.A. 75-4215, and amendments thereto. Upon receipt of
each such remittance, the state treasurer shall deposit the entire amount in
the state treasury to the credit of a separate
account in the state treasury for each application. The money in each such
account shall be used to pay the expenses of the commissioner, or designee
in the examination and investigation of the application to which it relates and
any unused balance shall be transferred to the bank commissioner fee fund.
(h) Upon the filing of any such application with the commissioner, the
commissioner shall make or cause to be made, a careful examination and
investigation concerning:
(1) The reasonable probability of usefulness and success of the contracting
trustee;
(2) the financial history and condition of the contracting trustee including
the character, qualifications and experience of the officers employed by the
contracting trustee; and
(3) whether the contracting agreement will result in any undue injury to
properly conducted existing banks, national banks and trust companies.
If the commissioner shall determine any of such matters unfavorably to the
applicants, the application shall be disapproved, but if not, then the
application shall be approved.
(i) If no written request for public hearing is filed, the commissioner
shall render approval or disapproval of the application within 60 days of the
date upon which the application was filed.
(j) If a written request for public hearing is filed, the commissioner shall
hold within 30 days of the close of the comment period, a public hearing in a
location determined by the commissioner. Notice of the time, date and place of
such hearing shall be published by the applicant in a newspaper of general
circulation in the county where the originating trustee or financial
institution is located, not less than 10 nor more than 30 days prior to the
date of the hearing, and an affidavit of publication shall be filed with the
commissioner. At any such hearing, all interested persons may present written
and oral evidence to the commissioner in support of or in opposition to the
application. Upon completion of a transcript of the testimony given at any
such hearing, the transcript shall be filed in the office of the commissioner.
Within 14 days after the public hearing, the commissioner shall approve or
disapprove the application after consideration of the application and evidence
gathered during the commissioner's investigation.
(k) The commissioner may extend the period for approval or disapproval if
the commissioner determines that any information required by this section has
not been furnished, any material information submitted is inaccurate or
additional investigation is required. The commissioner, prior to expiration of
the application period provided for by this section, shall give written notice
to each party to the agreement of the commissioner's intent to extend the
period which shall include a specific date for expiration of the extension
period. If any information remains incomplete or inaccurate upon the
expiration of the extension period the application shall be disapproved.
(l) Within 15 days of the date of the commissioner's approval or denial, the
applicant or any individual or corporation who filed a request for and
presented evidence at the public hearing shall have the right to appeal in
writing to the state banking board the
commissioner's determination by filing a notice of appeal with the
commissioner. The state banking board shall fix a date for hearing, which
hearing shall be
held within 45 days after such notice of appeal is filed. The board
shall conduct the hearing in accordance with the provisions of the Kansas
administrative procedure act and render its decision affirming or rescinding
the determination of the commissioner. Any action of the board pursuant to
this section is subject to review in accordance with the act for judicial
review and civil enforcement of agency actions.
Any party which files an appeal to the state banking board of the
commissioner's determination shall pay to the commissioner a fee in an amount
established by rules and regulations of the commissioner, adopted pursuant to
K.S.A. 9-1713, and amendments thereto, to defray the board's expenses
associated
with the conduct of the appeal.
(m) When the commissioner determines that any contracting trustee domiciled
in this state has entered into a contracting agreement in violation of the laws
governing the operation of such contracting trustee, the commissioner shall
give written notice to the contracting trustee and the originating trustee or
financial institution of such determination. Within 15 days after receipt of
such notification, the contracting trustee and originating trustee or financial
institution shall have the right to appeal in writing to the state banking
board the commissioner's determination. The board shall fix a date for
hearing, which shall be held within 45 days after the date of the
appeal and shall be conducted in accordance with the Kansas administrative
procedure act. At such hearing the board shall hear all matters relevant to
the commissioner's determination and shall approve or disapprove the
commissioner's determination. The decision of the board shall be final and
conclusive. If the contracting trustee does not appeal to the
board from the commissioner's determination or if an appeal is made and the
commissioner's determination is upheld by the board, the commissioner may
proceed as provided in K.S.A. 9-1714, and amendments thereto, until such
time as
the commissioner determines the contracting trustee, originating trustee and
financial institution are in full compliance with the laws governing the
operation of a contracting trustee and originating trustee or financial
institution.
(n) Any party entitled to receive a notice under subsection (f)(5) may file
a petition in the court having jurisdiction over the fiduciary relationship, or
if none, in the district court in the county where the originating trustee has
its principal office, seeking to remove any contracting trustee substituted or
about to be substituted as fiduciary pursuant to this section. Unless the
contracting trustee files a written consent to its removal or a written
declination to act subsequent to the filing of the petition, the court, upon
notice and hearing, shall determine the best interest of the petitioner and all
other parties concerned and shall fashion such relief as it deems appropriate
in the circumstances, including the awarding of reasonable attorney fees. The
right to file a petition under this subsection shall be in addition to any
other rights to remove fiduciary provided by any other statute or regulation or
by the writing creating the fiduciary relationship. If the removal of the
fiduciary is prompted solely as a result of the contracting agreement, any
reasonable cost associated with such removal and transfer, not to exceed $200
per account, shall be paid by the originating trustee or financial institution
entering into the agreement.
History: L. 1989, ch. 48, § 7;
L. 1990, ch. 60, § 3;
L. 1993, ch. 30, § 2;
L. 1994, ch. 51, § 1;
L. 1994, ch. 294, § 1;
L. 1999, ch. 18, § 1;
L. 2001, ch. 5, § 48; July 1.
9-2107.Allowing for the contracting for trust services; definitions;
notice filing; authority of commissioner; fees; examination; branches.
(a) As used in this section:
(1) "Contracting trustee" means any trust company, as defined in K.S.A.
9-701, and amendments thereto, any bank that has been granted trust
authority by the state bank commissioner under K.S.A. 9-1602, and amendments
thereto,
or any national bank chartered to do business in Kansas that has been
granted trust authority by the comptroller
of the currency under 12 USC 92a, or any bank that has been granted trust
authority or any trust company, regardless of where such bank or trust
company is located,
and which is controlled, as
defined in
K.S.A. 9-1612, and amendments thereto, by the same bank holding
company as any
trust company, state bank or national bank chartered to do business in
Kansas,
which accepts or succeeds to any fiduciary
responsibility as provided in this
section;
(2) "originating trustee" means any trust company, bank, national
banking association, savings and loan association or savings bank which has
trust powers and its principal place of business is in this state and which
places or transfers any fiduciary responsibility to a contracting trustee as
provided in this section;
(3) "financial institution" means any bank, national banking association,
savings and loan association or savings bank which has its principal place of
business in this state but which does not have trust powers.
(b) Any contracting trustee and any originating trustee may enter into
an agreement by which the contracting trustee, without any
further authorization of any kind, succeeds to and is
substituted for the originating trustee as to all fiduciary powers, rights,
duties, privileges
and liabilities with respect to all accounts for which the originating
trustee serves in any fiduciary capacity, except as may be provided
otherwise in the agreement.
Notwithstanding the provisions of this section, no contracting trustee as
defined in K.S.A. 9-2107(a)(1), and amendments thereto, having its home
office
outside the state of Kansas shall enter into an agreement except with an
originating trustee which is commonly controlled as defined in K.S.A.
9-1612,
and amendments thereto, by the same bank holding company.
(c) Unless the agreement expressly provides otherwise, upon the
effective date of the substitution:
(1) The contracting trustee shall be deemed to be named as the fiduciary
in all writings, including, without limitation, trust agreements, wills and
court orders, which pertain to the affected fiduciary accounts;
(2) the originating trustee is absolved from all fiduciary
duties
and obligations arising under such writings and shall discontinue the
exercise of any fiduciary duties with respect to such writings, except that
the originating trustee is not absolved or discharged from
any duty to account required by K.S.A. 59-1709, and
amendments thereto, or any other
applicable statute, rule of law, rules and
regulations or court order, nor shall the
originating trustee be absolved from any breach of fiduciary duty or
obligation occurring prior to the effective date of the agreement.
(d) The agreement may authorize the contracting trustee:
(1) To establish a trust service desk at any office of
the originating trustee at which the contracting trustee may conduct any
trust business and any business incidental thereto and which the
contracting trustee may otherwise conduct at its principal place of business;
and
(2) to engage the originating trustee as the agent of the contracting
trustee, on a disclosed basis to customers, for the purposes of providing
administrative, advertising and safekeeping services incident to the
fiduciary services provided by the contracting trustee.
(e) Any contracting trustee may enter into an agreement with a
financial institution providing that the contracting trustee may
establish a trust service desk as authorized by subsection (d) in the
offices of such
financial institution and which provides such financial institution, on a
disclosed basis to customers, may act as the agent of contracting trustee
for purposes of providing administrative services and advertising incident
to the fiduciary services to be performed by the contracting trustee.
(f) No activity authorized by subsections (b)
through (e) shall be conducted by any contracting trustee, originating trustee
or financial institution until an application for such authority has been
submitted to and approved by the commissioner. The application shall be in the
form and contain the information required by the commissioner, which shall at a
minimum include certified copies of the following documents:
(1) The agreement;
(2) the written action taken by the board of directors of the
originating trustee or financial institution approving the agreement;
(3) all other required regulatory approvals;
(4) an affidavit of publication of notice of intent to
file the application with the commissioner.
Publication of the notice shall be
on the same day for two consecutive
weeks in the official newspaper of the city or county where the principal
office of the originating trustee or financial institution is located.
The notice shall be in the form prescribed by the commissioner and shall
contain the name of the applicant contracting trustee, the originating trustee
or financial institution, the proposed date of filing of the application with
the commissioner, a solicitation for written comments concerning the
application, and a notice of the public's right to file a written request for a
public hearing for the purpose of presenting oral or written evidence regarding
the proposed agreement. All comments and requests for public hearing shall be
filed with the commissioner on or before the 30th day after the date the
application is filed; and
(5) a certification by the parties to the agreement that written notice of
the proposed substitution was sent by first-class mail to each cofiduciary,
each surviving settlor of a trust, each ward of a guardianship, each person who
has sole or shared power to remove the originating trustee as fiduciary and
each adult beneficiary currently receiving or entitled to receive a
distribution of principle or income from a fiduciary account
affected by the agreement, and that such notice was sent to each such person's
address as shown in the originating trustee's records. An unintentional failure
to give such notice shall not impair the validity or effect of any such
agreement, except an intentional failure to give such notice shall render the
agreement null and void as to the party not receiving the notice of
substitution.
(g) A contracting trustee making application to the commissioner for approval
of
any agreement pursuant to this section shall pay to the commissioner a fee, in
an amount established by rules and regulations of the commissioner adopted
pursuant to K.S.A. 9-1713, and amendments thereto, to defray the
expenses of the
commissioner or designee in the examination and investigation
of the application. The commissioner shall remit all amounts received under
this section to the state treasurer in
accordance
with the provisions of K.S.A. 75-4215, and amendments thereto. Upon receipt of
each such remittance, the state treasurer shall deposit the entire amount in
the state treasury to the credit of a separate
account in the state treasury for each application. The money in each such
account shall be used to pay the expenses of the commissioner, or designee
in the examination and investigation of the application to which it relates and
any unused balance shall be transferred to the bank commissioner fee fund.
(h) Upon the filing of any such application with the commissioner, the
commissioner shall make or cause to be made, a careful examination and
investigation concerning:
(1) The reasonable probability of usefulness and success of the contracting
trustee;
(2) the financial history and condition of the contracting trustee including
the character, qualifications and experience of the officers employed by the
contracting trustee; and
(3) whether the contracting agreement will result in any undue injury to
properly conducted existing banks, national banks and trust companies.
If the commissioner shall determine any of such matters unfavorably to the
applicants, the application shall be disapproved, but if not, then the
application shall be approved.
(i) If no written request for public hearing is filed, the commissioner
shall render approval or disapproval of the application within 60 days of the
date upon which the application was filed.
(j) If a written request for public hearing is filed, the commissioner shall
hold within 30 days of the close of the comment period, a public hearing in a
location determined by the commissioner. Notice of the time, date and place of
such hearing shall be published by the applicant in a newspaper of general
circulation in the county where the originating trustee or financial
institution is located, not less than 10 nor more than 30 days prior to the
date of the hearing, and an affidavit of publication shall be filed with the
commissioner. At any such hearing, all interested persons may present written
and oral evidence to the commissioner in support of or in opposition to the
application. Upon completion of a transcript of the testimony given at any
such hearing, the transcript shall be filed in the office of the commissioner.
Within 14 days after the public hearing, the commissioner shall approve or
disapprove the application after consideration of the application and evidence
gathered during the commissioner's investigation.
(k) The commissioner may extend the period for approval or disapproval if
the commissioner determines that any information required by this section has
not been furnished, any material information submitted is inaccurate or
additional investigation is required. The commissioner, prior to expiration of
the application period provided for by this section, shall give written notice
to each party to the agreement of the commissioner's intent to extend the
period which shall include a specific date for expiration of the extension
period. If any information remains incomplete or inaccurate upon the
expiration of the extension period the application shall be disapproved.
(l) Within 15 days of the date of the commissioner's approval or denial, the
applicant or any individual or corporation who filed a request for and
presented evidence at the public hearing shall have the right to appeal in
writing to the state banking board the
commissioner's determination by filing a notice of appeal with the
commissioner. The state banking board shall fix a date for hearing, which
hearing shall be
held within 45 days after such notice of appeal is filed. The board
shall conduct the hearing in accordance with the provisions of the Kansas
administrative procedure act and render its decision affirming or rescinding
the determination of the commissioner. Any action of the board pursuant to
this section is subject to review in accordance with the act for judicial
review and civil enforcement of agency actions.
Any party which files an appeal to the state banking board of the
commissioner's determination shall pay to the commissioner a fee in an amount
established by rules and regulations of the commissioner, adopted pursuant to
K.S.A. 9-1713, and amendments thereto, to defray the board's expenses
associated
with the conduct of the appeal.
(m) When the commissioner determines that any contracting trustee domiciled
in this state has entered into a contracting agreement in violation of the laws
governing the operation of such contracting trustee, the commissioner shall
give written notice to the contracting trustee and the originating trustee or
financial institution of such determination. Within 15 days after receipt of
such notification, the contracting trustee and originating trustee or financial
institution shall have the right to appeal in writing to the state banking
board the commissioner's determination. The board shall fix a date for
hearing, which shall be held within 45 days after the date of the
appeal and shall be conducted in accordance with the Kansas administrative
procedure act. At such hearing the board shall hear all matters relevant to
the commissioner's determination and shall approve or disapprove the
commissioner's determination. The decision of the board shall be final and
conclusive. If the contracting trustee does not appeal to the
board from the commissioner's determination or if an appeal is made and the
commissioner's determination is upheld by the board, the commissioner may
proceed as provided in K.S.A. 9-1714, and amendments thereto, until such
time as
the commissioner determines the contracting trustee, originating trustee and
financial institution are in full compliance with the laws governing the
operation of a contracting trustee and originating trustee or financial
institution.
(n) Any party entitled to receive a notice under subsection (f)(5) may file
a petition in the court having jurisdiction over the fiduciary relationship, or
if none, in the district court in the county where the originating trustee has
its principal office, seeking to remove any contracting trustee substituted or
about to be substituted as fiduciary pursuant to this section. Unless the
contracting trustee files a written consent to its removal or a written
declination to act subsequent to the filing of the petition, the court, upon
notice and hearing, shall determine the best interest of the petitioner and all
other parties concerned and shall fashion such relief as it deems appropriate
in the circumstances, including the awarding of reasonable attorney fees. The
right to file a petition under this subsection shall be in addition to any
other rights to remove fiduciary provided by any other statute or regulation or
by the writing creating the fiduciary relationship. If the removal of the
fiduciary is prompted solely as a result of the contracting agreement, any
reasonable cost associated with such removal and transfer, not to exceed $200
per account, shall be paid by the originating trustee or financial institution
entering into the agreement.
History: L. 1989, ch. 48, § 7;
L. 1990, ch. 60, § 3;
L. 1993, ch. 30, § 2;
L. 1994, ch. 51, § 1;
L. 1994, ch. 294, § 1;
L. 1999, ch. 18, § 1;
L. 2001, ch. 5, § 48; July 1.