Self-executing ban on fiduciary exculpation

P/OPINION 75-122


                                                                 410

                          July 2, 1975

Dear           :

Your letter of June 3, 1975, addressed to
                                            has been
referred to this office for reply.

In your letter you inquired whether an attached draft
plan amendment would meet the requirements of section
410(a) of the Employee Retirement Income Security
Act of 1974. You stated that the draft amendment is
designed to bring a pension plan into compliance with
section 410(a) of the Act until extensive permanent
revisions of the plan are made.

Section 410(a) of the Act reads as follows:

        Except as provided in section 405(b)(1)
        and 405(d), any provision in an agreement
        or instrument which purports to relieve
        a fiduciary from responsibility or liability
        for any responsibility, obligation, or duty
        under this part shall be void as against public
        policy.

Section 410(a) is self-executing. Any provisions contrary
to section 410(a) in documents relating to an employee
benefit plan subject to Part 4 of Title I of the Act
automatically become void when the plan becomes subject
to section 410(a). Amendments such as the draft attached
to your letter are unnecessary even though a plan may
contain provisions contrary to section 410(a). Although
it would be preferable if provisions invalidated by section
410(a) were removed from plan instruments as soon as possible,
since these invalid provisions may mislead plan fiduciaries,
participants, beneficiaries and other interested persons,
such amendments need not be made as soon as section 410(a)
becomes applicable to the plan, but may be deferred until
other amendments necessitated by the Act are made. In the
interim before such amendments are made, a plan may be
amended to include language nullifying exculpatory clauses,
even though such language is superfluous; however, this
office will not render opinions as to the appropriateness of
such language.

Sincerely,