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Current through October 23, 2012
(a) A beneficial owner may maintain a direct action against a statutory trust to redress an injury sustained by, or to enforce a duty owed to, the beneficial owner if the beneficial owner can prevail without showing an injury or breach of duty to the trust.
(b) A beneficial owner may maintain a derivative action to redress an injury sustained by, or enforce a duty owed to, a statutory trust if:
(1) The beneficial owner first makes a demand on the trustees, requesting that the trustees cause the trust to bring an action to redress the injury or enforce the right, and the trustees do not bring the action within a reasonable time; or
(2) A demand would be futile.
(c) A derivative action on behalf of a statutory trust shall be maintained only by a person that is a beneficial owner at the time the action is commenced and:
(1) Was a beneficial owner when the conduct giving rise to the action occurred; or
(2) Acquired the status as a beneficial owner by operation of law or pursuant to the terms of the governing instrument from a person that was a beneficial owner at the time of the conduct.
(d) In a derivative action on behalf of the statutory trust, the complaint shall state with particularity the:
(1) Date and content of the plaintiff's demand and the trustees' response to the demand; or
(2) Reason the demand should be excused as futile.
(e) Except as otherwise provided in subsection (f) of this section:
(1) Any proceeds or other benefits of a derivative action on behalf of a statutory trust, whether by judgment or settlement, shall be the property of the trust and not of the plaintiff; and
(2) If the plaintiff receives any proceeds or other benefits, the plaintiff shall immediately remit them to the trust.
(f) If a derivative action on behalf of a statutory trust is successful in whole or in part, the court may award the plaintiff reasonable attorneys' fees, costs, and other expenses from the recovery by the trust.
(g) A derivative action on behalf of a statutory trust shall not be voluntarily dismissed or settled without the court's approval.
(July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720.)
HISTORICAL AND STATUTORY NOTES
Legislative History of Laws
For history of Law 18-378, see notes under § 29-101.01.
Uniform Law
This section is based on § 609 of the Uniform Statutory Trust Entity Act . See Vol. 6B , Uniform Laws Annotated, Master Edition or ULA Database on Westlaw.
