Annual Trust Accounting (Hawaii Uniform Trust Code, HRS § 554D-813(c))

ANNUAL TRUSTEE'S REPORT (TRUST ACCOUNTING)

Pursuant to Hawaii Uniform Trust Code, HRS § 554D-813(c)

I. TRUST IDENTIFICATION

II. TRUSTEE IDENTIFICATION

III. BENEFICIARIES RECEIVING THIS REPORT (HRS § 554D-813(c))

IV. SUMMARY OF ACCOUNT

V. SCHEDULE OF RECEIPTS (HRS § 554D-813(c))

A. Income Receipts

B. Principal Receipts

VI. SCHEDULE OF DISBURSEMENTS (HRS § 554D-813(c))

A. Ordinary Administration Expenses

B. Distributions to Beneficiaries

C. Taxes

VII. STARTING INVENTORY OF TRUST ASSETS (As of [__/__/____])

VIII. ENDING INVENTORY OF TRUST ASSETS (HRS § 554D-813(c)) (As of [__/__/____])

IX. STATEMENT OF LIABILITIES (HRS § 554D-813(c))

☐ The Trust has no outstanding liabilities as of the end of the accounting period.

X. TRUSTEE COMPENSATION AND AGENTS HIRED

A. Trustee Compensation — Source and Amount (HRS § 554D-813(c))

B. Agents Hired by Trustee

C. Related-Party Transactions

☐ The Trustee did not engage in any transactions during the accounting period with the Trustee personally, with any entity in which the Trustee holds a beneficial interest, or with any agent related to the Trustee, other than as fully disclosed above.

☐ The following related-party transactions occurred during the accounting period and are fully disclosed for the beneficiaries' review:

[____________________________________________________________]

[____________________________________________________________]

XI. LIMITATION NOTICE — ONE-YEAR BAR ON BREACH-OF-TRUST CLAIMS (HRS § 554D-1005)

NOTICE TO BENEFICIARIES — LIMITATION ON CLAIMS AGAINST THE TRUSTEE

Under Hawaii Revised Statutes § 554D-1005(a), you may not commence a judicial proceeding against the Trustee for breach of trust more than ONE (1) YEAR after the date this report (or any future report) was sent to you, if the report adequately disclosed the existence of a potential claim for breach of trust. The one-year period runs from the date of sending. If this report does not adequately disclose a potential claim, the residual limitations periods of HRS § 554D-1005(c) — three (3) years after the first to occur of the Trustee's removal or resignation, the termination of your interest in the Trust, or the termination of the Trust — will apply. For claims against a deceased Trustee, see HRS § 560:3-803(a).

If you believe this report fails to disclose facts necessary for you to evaluate a potential claim, you should request additional information from the Trustee in writing or seek legal advice promptly.

XII. BENEFICIARY OBJECTION MECHANISM — CIRCUIT COURT PROBATE DIVISION

A beneficiary who has questions or objections to any item in this report is encouraged (but not required) to contact the Trustee in writing within [____] days of receipt at the address in Section II. This informal step does not extend, shorten, or substitute for the statutory limitations periods stated in Section XI.

A beneficiary or other interested person may also petition the appropriate Circuit Court Probate Division pursuant to HRS § 554D-201 and the Hawaii Probate Rules (Part D) for, among other things:

• Approval or disapproval of this report and the acts of the Trustee;
• Compelling a fuller accounting;
• Construction of trust terms;
• Removal of the Trustee; and
• Surcharge or other relief for breach of trust.

Trustee Contact for Objections / Inquiries:

XIII. EXCULPATION DISCLOSURE (HRS § 554D-1008)

☐ The Trust instrument contains no provision purporting to exculpate the Trustee.

☐ The Trust instrument contains an exculpation provision at Section [______]. Under HRS § 554D-1008, that provision is unenforceable to the extent it relieves the Trustee of liability for breach committed in bad faith or with reckless indifference to the purposes of the Trust or the interests of the beneficiaries, or was inserted as a result of an abuse of a fiduciary or confidential relationship with the settlor.

XIV. TRUSTEE VERIFICATION AND SIGNATURE

I, the undersigned Trustee, declare under penalty of perjury under the laws of the State of Hawaii:

1. I have reviewed the foregoing Annual Trustee's Report and each schedule attached;
2. The information set forth is true, correct, and complete to the best of my knowledge, based on the books, records, and supporting documentation of the Trust;
3. All material receipts, disbursements, assets, liabilities, trustee compensation (source and amount), and agents hired (including any related-party agents) for the accounting period stated above are disclosed; and
4. This report is furnished pursuant to Hawaii Revised Statutes § 554D-813(c).

Executed on [__/__/____] at [____________________], Hawaii.

Trustee Signature: [________________________________]

Print Name: [________________________________]

Capacity: [________________________________]

XV. OPTIONAL — BENEFICIARY RECEIPT AND RELEASE (HRS § 554D-1009)

Beneficiary Receipt, Release, and Ratification

I, the undersigned Beneficiary of the Trust identified in Section I, acknowledge:

1. I have received and had a reasonable opportunity to review this Annual Trustee's Report covering the period from [__/__/____] through [__/__/____];
2. I have been advised of my right to request a copy of the Trust instrument and to consult independent legal counsel, and I have either obtained such counsel or knowingly elected not to do so;
3. I am a competent adult; the Trustee has answered my reasonable requests for information regarding the Trust; and I am not aware of any improper conduct, concealment, or material misstatement by the Trustee that induces this acknowledgment;
4. Pursuant to HRS § 554D-1009, I hereby APPROVE the acts of the Trustee disclosed in this Report, RELEASE the Trustee from liability for any matter adequately disclosed in this Report, and RATIFY the administration of the Trust as set forth herein; and
5. I understand that this release does not extend to matters not adequately disclosed and does not waive any future duty of the Trustee.

Beneficiary Name (with diacritical marks): [________________________________]

Signature: [________________________________]

Date: [__/__/____]

Place of Execution: [____________________], Hawaii

XVI. PROOF OF SERVICE

I, the undersigned, declare that I am over the age of 18 years and not a party to this matter. My business or residence address is set forth below. On [__/__/____], I served the foregoing ANNUAL TRUSTEE'S REPORT on each beneficiary identified in Section III, by placing a true copy in a sealed envelope addressed to each such beneficiary at the address set forth in Section III, with postage thereon fully prepaid, and depositing the envelope in the United States Mail at [____________________], Hawaii, OR by personal delivery, certified mail with return receipt requested, or other method reasonably suitable under HRS § 554D-109 as indicated.

I declare under penalty of perjury under the laws of the State of Hawaii that the foregoing is true and correct.

Date: [__/__/____]

Signature: [________________________________]

Print Name: [________________________________]

Address: [________________________________]

SOURCES AND REFERENCES

• HRS § 554D-813 (Duty to Inform and Report) — https://codes.findlaw.com/hi/division-3-property-family/hi-rev-st-sect-554d-813/
• HRS § 554D-1005 (Limitation of Action Against Trustee) — https://codes.findlaw.com/hi/division-3-property-family/hi-rev-st-sect-554d-1005/
• HRS § 554D-1008 (Exculpation of Trustee) — https://www.capitol.hawaii.gov/hrscurrent/Vol13_Ch0501-0588/HRS0554D/
• HRS § 554D-1009 (Beneficiary's Consent, Release, or Ratification) — https://www.capitol.hawaii.gov/hrscurrent/Vol13_Ch0501-0588/HRS0554D/
• HRS § 554D-105 (Mandatory Provisions) — https://www.capitol.hawaii.gov/hrscurrent/Vol13_Ch0501-0588/HRS0554D/
• HRS § 554D-303 (Representation) — https://www.capitol.hawaii.gov/hrscurrent/Vol13_Ch0501-0588/HRS0554D/
• HRS § 560:3-803 (Limitations on Claims Against Decedent) — https://law.justia.com/codes/hawaii/title-30a/chapter-560/
• HRS Chapter 557A (Hawaii Principal and Income Act) — https://www.capitol.hawaii.gov/hrscurrent/Vol12_Ch0501-0588/HRS0557A/
• HRS Chapter 554G (Hawaii Permitted Transfers in Trust Act / Hawaii DAPT) — https://www.capitol.hawaii.gov/hrscurrent/Vol13_Ch0501-0588/HRS0554G/
• Hawaii Probate Rules, Part D (Trust Proceedings) — https://www.courts.state.hi.us/
• Act 31, Session Laws of Hawaii 2021 (Hawaii Uniform Trust Code; effective January 1, 2022).
• Cades Schutte, "Hawaiʻi Adopts New Uniform Trust Code" (December 20, 2021).
• Cades Schutte, "Hawaiʻi's New Uniform Trust Code: Part II" (August 8, 2022).