New Jersey § 3b:31-55

§ 3b:31-55.

Duty of Loyalty. a. A trustee shall administer the trust with undivided loyalty to and solely in the

best interests of the beneficiaries. b. Subject to the rights of persons dealing with or assisting the trustee as provided

in N.J.S.3B:14-37 , a sale, encumbrance, or other transaction involving the investment or management

of trust property entered into by the trustee for the trustee's own personal account

or which is otherwise affected by a conflict between the trustee's fiduciary and personal

interests is voidable by a beneficiary affected by the transaction unless: (1) the transaction was authorized by the terms of the trust; (2) the transaction was approved by the court; (3) the beneficiary did not commence a judicial proceeding within the time allowed

by N.J.S.3B:31-74 ; (4) the beneficiary consented to the trustee's conduct, ratified the transaction,

or released the trustee in compliance with N.J.S.3B:31-78 ; or (5) the transaction involves a contract entered into or a claim acquired by the trustee

before the person became a trustee. c. A sale, encumbrance, or other transaction involving the investment or management

of trust property is presumed to be affected by a conflict between personal and fiduciary

interests if it is entered into by the trustee with: (1) the trustee's spouse or partner in a civil union; (2) the trustee's parents, parents' descendants, or the spouse or partner in a civil

union of any of the foregoing; (3) an agent, accountant, or attorney of the trustee; or (4) a corporation or other person or enterprise in which the trustee, or a person

that owns a significant interest in the trustee, has an interest that might affect

the trustee's judgment. d. A transaction between a trustee and a beneficiary that does not concern trust property

but that occurs during the existence of the trust or while the trustee retains significant

influence over the beneficiary and from which the trustee obtains an advantage attributable

to the existence of the trust is voidable by the beneficiary if the beneficiary establishes

that the transaction was unfair to the beneficiary. e. A transaction not concerning trust property in which the trustee engages in the

trustee's individual capacity involves a conflict between personal and fiduciary interests

if the transaction concerns an opportunity properly belonging to the trust. f. In voting shares of stock of a corporation or in exercising powers of control over

similar interests in other forms of enterprise, the trustee shall act in the best

interests of the beneficiaries and shall vote to elect or appoint directors or other

managers who will manage the corporation or enterprise in the best interests of the

beneficiaries. g. This section does not preclude the following transactions, if fair to the beneficiaries: (1) an agreement between a trustee and a beneficiary relating to the appointment or

compensation of the trustee; (2) payment of reasonable compensation to the trustee; (3) a transaction between the trust and another trust, decedent's estate, guardianship,

conservatorship, or other fiduciary relationship of which the trustee is a fiduciary

or in which a beneficiary has an interest; (4) a deposit of trust money in a regulated financial-service institution operated

by or affiliated with the trustee; or (5) an advance by the trustee of money for the protection of the trust. h. The court may appoint a special fiduciary to make decisions with respect to any

proposed transaction that might violate this section if entered into by the trustee.