H. B. 2251
(By Delegates Williams, Carper, Phillips, H. White,
Rutledge and Harrison)
[Introduced February 23, 1993; referred to the
Committee on the Judiciary.]
A BILL to amend article five, chapter forty-four of the code of
West Virginia, one thousand nine hundred thirty-one, as
amended, by adding thereto a new section, designated section
fourteen, relating to providing fiduciaries with specific
statutory powers to respond to environmental problems.
Be it enacted by the Legislature of West Virginia:
That article five, chapter forty-four of the code of West
Virginia, one thousand nine hundred thirty-one, as amended, be
amended by adding thereto a new section, designated section
fourteen, to read as follows:
ARTICLE 5. GENERAL PROVISIONS AS TO FIDUCIARIES.
§44-5-14. Powers of fiduciaries regarding environmental laws.
(a) For purposes of this subsection, "environmental law"
means any federal, state or local law, rule, regulation or
ordinance relating to the protection of the environment or human
health. For purposes of this subsection, "hazardous substances"
means any substance defined as "hazardous" or "toxic" or
otherwise regulated by any environmental law.
(b) In addition to powers, remedies and rights which might
be set forth in any will, trust agreement or other document which
is the source of authority, a trustee, executor, administrator,
guardian, or one acting in any other fiduciary capacity, whether
an individual, corporation or other entity ("fiduciary") has the
following powers, rights and remedies whether or not set forth in
the will, trust agreement or other document which is the source
of authority:
(1) To inspect property held by the fiduciary including
interests in sole proprietorships, partnerships or corporations
and any assets owned by any such business enterprise, for the
purpose of determining compliance with environmental law
affecting such property and to respond to any actual or potential
violation of any environmental law affecting property held by the
fiduciary;
(2) To take, on behalf of the estate or trust, any action
necessary to prevent, abate or otherwise remedy any actual or
threatened violation of any environmental law affecting property
held by the fiduciary, either before or after the initiation of
an enforcement action by any governmental body;
(3) To refuse to accept property in trust if the fiduciary
determines any property to be donated or conveyed to the trust is
contaminated by any hazardous substance or is being used or has
been used for any activity directly or indirectly involving any
hazardous substance which could result in liability to the trust
or otherwise or impair the value of the assets held therein;
(4) To settle or compromise at any time any and all claims
against the trust or estate which may be asserted by anygovernmental body or private party involving the alleged
violation of any environmental law affecting property held in
trust or in an estate;
(5) To disclaim any power granted by any document, statute,
or rule of law which, in the sole discretion of the fiduciary,
may cause the fiduciary to incur personal liability under any
environmental law;
(6) To decline to serve as a fiduciary if the fiduciary
reasonably believes that there is or may be a conflict of
interest between it and its fiduciary capacity and in its
individual capacity because of potential claims or liabilities
which may be asserted against it on behalf of the trust or estate
because of the type or condition of assets held therein.
(c) The fiduciary is entitled to charge the cost of any
inspection, review, abatement, response, cleanup or remedial
action authorized herein against the income or principal of the
trust or estate.
(d) A fiduciary is not personally liable to any beneficiary
or other party for any decrease in value of assets in trust or in
an estate by reason of the fiduciary's compliance with any
environmental law, specifically including any reporting
requirement under such law.
(e) Neither the acceptance by the fiduciary of property nor
the failure by the fiduciary to inspect property creates any
inference as to whether or not there is or may be any liability
under any environmental law with respect to such property.
NOTE: The purpose of this bill is to make clear that
fiduciaries have the authority to handle environmental matterswhich may affect property held by a fiduciary. The bill provides
that a fiduciary will not be personably liable for the
expenditure of resources held in fiduciary capacity to inspect
and remedy any environmental contamination and as otherwise may
be required to comply with applicable environmental laws. The
bill also permits a fiduciary to refuse to accept or hold
contaminated property, to settle disputes relating to
contaminated property and to decline to serve or resign if
personal liability may arise or if the prospect of personal
liability creates a conflict of interest.