760 ILCS 3/111

(760 ILCS 3/111)

Sec. 111. Nonjudicial settlement agreements.

(a) Interested persons, or their respective representatives determined after giving effect to Article 3, may enter into a binding nonjudicial settlement agreement with respect to any matter listed in subsection (b).

(b) The following matters may be resolved by a nonjudicial settlement agreement:

(1) Validity, interpretation, or construction of the terms of the trust.

(2) Approval of a trustee's report or accounting.

(3) Exercise or nonexercise of any power by a trustee.

(4) The grant to a trustee of any necessary or desirable administrative power.

(5) Questions relating to property or an interest in property held by the trust.

(6) Removal, appointment, or removal and appointment of a trustee, trust advisor, investment advisor, distribution advisor, trust protector, or other holder, or committee of holders, of fiduciary or nonfiduciary powers, including without limitation designation of a plan of succession or procedure to determine successors to any such office.

(7) Determination of a trustee's or other fiduciary's compensation.

(8) Transfer of a trust's principal place of administration, including, without limitation, to change the law governing administration of the trust.

(9) Liability or indemnification of a trustee for an action relating to the trust.

(10) Resolution of bona fide disputes related to trust administration, investment, distribution, or other matters.

(11) Modification of the terms of the trust pertaining to the administration of the trust.

(12) Determining whether the aggregate interests of each beneficiary in severed trusts are substantially equivalent to the beneficiary's interests in the trusts before severance.

(13) Termination of the trust, except that court approval of the termination must be obtained in accordance with subsection (d), and the court must find that continuance of the trust is not necessary to achieve any clear material purpose of the trust. The court shall consider spendthrift provisions as a factor in making a decision under this subsection, but a spendthrift provision is not necessarily a material purpose of a trust, and the court is not precluded from modifying or terminating a trust because the trust instrument contains spendthrift provisions. Upon termination, the court shall order the distribution of the trust property as agreed by the parties to the agreement, or if the parties cannot agree, then as the court determines is equitable and consistent with the purposes of the trust.

(c) If a trust contains a charitable interest, the parties to any proposed nonjudicial settlement agreement affecting the trust shall deliver to the Attorney General written notice of the proposed agreement at least 60 days before its effective date. The Bureau is not required to take action, but if it objects in a writing delivered to one or more of the parties before the proposed effective date, the agreement shall not take effect unless the parties obtain court approval.

(d) Any beneficiary or other interested person may request the court to approve any part or all of a nonjudicial settlement agreement, including, without limitation, whether any representation is adequate and without material conflict of interest, if the petition for approval is filed within 60 days after the effective date of the agreement.

(e) An agreement entered into in accordance with this Section, or a judicial proceeding pursued in accordance with this Section, is final and binding on the trustee, on all beneficiaries of the trust, both current and future, and on all other interested persons as if ordered by a court with competent jurisdiction over the trust, the trust property, and all interested persons.

(f) In the trustee's sole discretion, the trustee may, but is not required to, obtain and rely upon an opinion of counsel on any matter relevant to this Section, including, without limitation:

(1) if required by this Section, that the agreement proposed to be made in accordance with this Section does not conflict with a clear material purpose of the trust;

(2) in the case of a trust termination, that continuance of the trust is not necessary to achieve any clear material purpose of the trust;

(3) that there is no material conflict of interest between a representative and the person represented with respect to the particular question or dispute; and

(4) that the representative and the person represented have substantially similar interests with respect to the particular question or dispute.

(g) This Section shall be construed as pertaining to the administration of a trust and shall be available to any trust that has its principal place of administration in this State, including a trust whose principal place of administration has been changed to this State, or that is governed by the law of this State for the purpose of determining the meaning and effect of terms of the trust or construction of terms of the trust, except to the extent the trust instrument expressly prohibits the use of this Section by specific reference to this Section or a prior corresponding law. A provision in the trust instrument in the form: "Neither the provisions of Section 111 of the Illinois Trust Code nor any corresponding provision of future law may be used in the administration of this trust", or a similar provision demonstrating that intent, is sufficient to preclude the use of this Section.

(Source: P.A. 101-48, eff. 1-1-20; 102-279, eff. 1-1-22.)