The twentieth century closed with American trust law in roughly the same shape it had assumed under Lord Hardwicke two and a half centuries earlier — but spread across fifty state jurisdictions, articulated through thousands of cases, and increasingly difficult to summarize. Two great codifying enterprises addressed the problem: the American Law Institute’s Restatement of Trusts, first published in 1935, revised in the Restatement (Second) of Trusts (1959), and rewritten substantially in the Restatement (Third) of Trusts (volumes appearing from 2003 through 2012); and the Uniform Law Commission’s Uniform Trust Code, promulgated in 2000 and subsequently adopted in some form by more than thirty states.
The Restatement and the Uniform Trust Code together represent the doctrinal floor on which every modern school trust lands case stands. They state, in disciplined and codified form, the duties of the trustee that the Chancery had built up over four centuries.
Six core duties recur across the two texts and are visible in every school-trust-lands dispute.
The duty of loyalty — drawn directly from the Cardozo line in Meinhard — requires the trustee to administer the trust solely in the interest of the beneficiaries, without preferring his own interests or those of any third party. Restatement (Third) §78; UTC §802.
The duty of prudence requires the trustee to manage the trust property as a prudent person would, with reasonable care, skill, and caution, considering both the purposes of the trust and the circumstances of the beneficiaries. Restatement (Third) §77; UTC §804.
The duty of impartiality requires the trustee to administer the trust giving due regard to the interests of all beneficiaries, including beneficiaries of different generations. Restatement (Third) §79; UTC §803. For a school trust, this is the duty that prevents the present generation of beneficiaries from being preferred at the expense of future generations — the intergenerational equity principle that flows directly from the forever of Article III of the Northwest Ordinance.
The duty of productivity requires the trustee to make the trust property productive, consistent with the trust purposes. Idle assets are a breach. For school trust lands, this duty supports the requirement that the state actually manage the lands to produce income for the schools, rather than allowing them to lie fallow or be devoted to unrelated purposes.
The duty of permanence — the requirement that the trust corpus be preserved across generations — flows from the temporal structure of a perpetual trust. The trustee may spend income but may not deplete principal. For school trust lands, this is the rule that the lands themselves, or property of equivalent value, must remain in the trust; sales must be for full value, and the proceeds must be reinvested rather than consumed.
The duty of accounting requires the trustee to keep adequate records and to render an accurate accounting to the beneficiary on demand. Restatement (Third) §83; UTC §813. In the school trust lands context, this is the duty that supports legislative reporting requirements, audit obligations, and the transparency provisions that allow beneficiaries to know what the trustee has done with their property.
These six duties, codified in the Restatement and the Uniform Trust Code, are the doctrinal endpoint of the lineage. They are what an Oregon court applies when it asks whether the State Land Board has lawfully managed the Common School Fund Lands. They are the lens through which the 1859 Admissions Act is read. They are the modern statement of the same obligations that the Chancery applied to the medieval feoffee and that Cardozo restated for the joint venturer in 1928. The lineage closes here, with codified duties whose ancestry runs back through eight centuries of legal development.
“A trustee shall administer the trust solely in the interests of the beneficiaries.” — Uniform Trust Code § 802(a) (2000).
Primary source. Uniform Trust Code (Uniform Law Commission, 2000, as amended) — uniformlaws.org · Trust Code Final Act; Oregon adoption at ORS Chapter 130 — oregonlegislature.gov · ors130.
References. Restatement (Third) of Trusts (Am. Law Inst. 2003–2012); Uniform Trust Code (Nat’l Conf. of Comm’rs on Unif. State Laws 2000, as amended); Oregon’s adoption at ORS 130.001 et seq., including ORS 130.650–130.710 (codifying trustee duties of loyalty, impartiality, prudence, and disclosure).
