If the instrument and state law are silent, can a bank trustee defer an investment decision to an individual co-trustee?

In the context of trust administration, trustees have specific fiduciary duties that require them to make prudent investment decisions in the best interest of the beneficiaries. If the governing instrument (the trust document) and applicable state law do not allow for delegation of investment decisions, a bank trustee is legally obligated to act on its own regarding these investment matters.

This obligation is rooted in the principle that trustees are expected to be hands-on managers of trust assets, ensuring that they are managed wisely and in accordance with the requirements of the trust and the law. Delegating this responsibility to an individual co-trustee, especially if not permitted by either the trust document or state law, could lead to potential breaches of fiduciary duty, exposing the bank trustee to liability for any losses incurred as a result of such delegation.

The emphasis is on the legal requirement for the trustee to fulfill their role personally unless explicitly given authority to delegate. Therefore, without explicit provision for delegation in the relevant documents or laws, the bank trustee must make investment decisions independently.