February 24, 1978

Re: Opinion Regarding Financial Code Section 1503

Dear Mr. ________:

Thank you for your letter dated February 23, 1978.

In that letter you asked our opinion whether or not it would be a violation of California Financial Code Section 1503 for ________ to act as testamentary trustee under the Will of a California resident. You stated that the trustee would be vested with all of the usual powers of testamentary trustees, including investment of assets, payment of income, rendering accountings, collecting income, etc. The RES of the trust would consist of $150,000 in cash or a like amount of corporate stock. The RES would be physically located at the bank’s corporate headquarters in Louisiana. Further, the income beneficiary would be a Louisiana resident and therefore, it is anticipated that the payments of income and/or principal would be made entirely within the State of Louisiana.

Based on the facts as stated above, it is the Department’s opinion that ________ would not be conducting a trust business in California as defined by Section 106 of the California Financial Code. Moreover, we do not feel that such action would be a violation of the McFadden Act (12 U.S.C.A. Section 36).

In summary, ________ can act as testamentary trustee under a trust created in California by the Will of a California resident which trust is subject to the jurisdiction of the California Superior Court without first qualifying to conduct a trust business in California.

Very truly yours,

Superintendent of Banks




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