Section 100-C. Common trust funds

1.  For the purpose of investment and
  reinvestment of moneys  received  and  held  by  any  trust  company  as
  executor,  administrator,  guardian,  trustee,  donee  of  power  during
  minority to manage property vested in an  infant,  custodian  under  any
  Uniform  Gifts to Minors Act, any Uniform Transfers to Minors Act or The
  New York Uniform Transfers to Minors Act, conservator or committee, such
  trust company may establish and maintain common trust  funds  and  short
  term  investment common trust funds. In any case where the instrument or
  the order, decree or judgment under which such moneys are held does  not
  forbid,  such  trust company, either alone or in conjunction with one or
  more other persons acting with it in any fiduciary capacity, may  invest
  and  reinvest  such moneys or any part thereof by adding the same to any
  such common trust funds and short term investment  common  trust  funds.
  Such  trust  company  shall  have  the same power to invest common trust
  funds in  securities  of  any  management  type  investment  company  or
  investment  trust, registered pursuant to the federal investment company
  act of nineteen hundred forty, as is set forth in, and  subject  to  the
  provisions  of,  sections  11-2.2  and 11-2.3 of the estates, powers and
  trusts law.
    2. Notwithstanding any other provision of law,  a  trust  company  may
  deposit  securities  investments  of a common trust fund, or arrange for
  the deposit of such investments  through  a  subcustodian,  (a)  with  a
  clearing corporation pursuant to EPTL 11-1.9, (b) with a federal reserve
  bank  pursuant  to  EPTL  11-1.8,  or  (c) with a securities depository,
  clearing agency, or bank, whether or  not  subject  to  the  laws  of  a
  jurisdiction  other  than  the United States of America, or any state or
  subdivision thereof, for the account  of  the  trust  company  and  such
  investments  shall  be  deemed for the purposes of this section to be in
  the custody of such trust company.
    3. A common trust fund shall not be deemed a separate  trust  fund  on
  which  commissions  or  other  compensation  is  allowable  and no trust
  company maintaining such a fund shall make any charge against such  fund
  for  the  management thereof. Provided, however, that in those instances
  where a trust company invests common trust funds in  securities  of  any
  management  type  investment company or investment trust pursuant to the
  provisions of subdivision one of this section, such  trust  company  may
  charge  the  common  trust  fund  for  the  fees  and  expenses  of such
  securities pursuant to and consistent with the  provisions  of  sections
  11-2.2 and 11-2.3 of the estates, powers and trusts law.
    4.  If money of an estate, trust or fund or any part thereof held by a
  trust company in conjunction with one  or  more  other  persons  in  any
  fiduciary capacity is invested in a common trust fund, the participating
  interest  therein  so  acquired  shall  be  withdrawn therefrom upon the
  written request of any  such  other  person  acting  in  such  fiduciary
  capacity with such trust company.
    5.  If  any  investment  held in a common trust fund shall cease to be
  eligible as a new investment  of  such  common  trust  fund,  the  trust
  company  maintaining  the  common  trust  fund,  prior  to  any  further
  additions to or withdrawals from  such  fund,  either  shall  sell  such
  investment  or shall set the same apart in a liquidating account for the
  benefit ratably of each participant then interested in such common trust
  fund.
    6. At least once every ten years, each  trust  company  maintaining  a
  common  trust  fund  shall file an account of its proceedings in respect
  thereof either in the office of the clerk of the supreme court or in the
  office of the surrogate in  any  county  in  which  such  trust  company
  maintains an office.

    Upon  the  filing  of the petition for the settlement of such account,
  the court shall assign a time and place for a hearing on the  settlement
  of  such  account  and  order notice thereof by: (a) one publication not
  less than twenty days prior to the date of such hearing, of a notice  in
  a  newspaper to be designated by the court, and (b) mailing on or before
  the day of publication a copy of the notice to all persons  whose  names
  and addresses appear, at the close of the period accounted for, upon the
  records  maintained  by the trust company pertaining to the common trust
  fund as well as to any estate, trust or fund, any part  of  which  shall
  have  been invested in the common trust fund and who at the close of the
  period accounted for were known by such trust company to be or to  claim
  to be included in any of the following classes of persons: (i) those who
  at  any  time  during the period accounted for were entitled to share in
  the income of any estate, trust or fund invested  in  the  common  trust
  fund  at any time during the period accounted for; (ii) those who became
  entitled to share in the principal of any estate, trust or fund invested
  in the common trust fund which became distributable in whole or in  part
  during  the  period  accounted  for; (iii) those who at the close of the
  period accounted for would have been entitled to share in the  principal
  of  any  estate,  trust or fund invested in the common trust fund if the
  event upon which such estate, trust or fund would  become  distributable
  in  whole  or  in part had occurred at the close of the period accounted
  for, provided, however, that in the case of a trust which at  the  close
  of  the  period accounted for can be revoked in its entirety in favor of
  and by the grantor, donor, trustor or creator, it shall not be necessary
  for such trust company to include the names and addresses of any persons
  interested in the principal of such trust other than the grantor, donor,
  trustor, or creator; (iv) those  living  at  the  close  of  the  period
  accounted  for who had any interest in the income or principal, or both,
  of any estate, trust or fund invested in the common trust fund, and  who
  prior  to  the close of the period accounted for shall have notified the
  trust company in writing to send a copy of the notice or citation of any
  proceeding for the settlement of any account  or  the  trustee  of  such
  common  trust  fund  to such person at an address furnished to the trust
  company by such person; (v) those who at  any  time  during  the  period
  accounted for were acting with the trust company in a fiduciary capacity
  with respect to any such estate, trust or fund; (vi) the guardian of any
  infant,  the  committee  of  any  incompetent and the conservator of any
  conservatee included among the persons hereinbefore described; (vii) the
  personal representative  of  any  deceased  person  included  among  the
  persons hereinbefore described in class (i), (ii), (iii), or (v).
    Upon  the filing of such petition, the court shall appoint a person to
  appear as guardian  ad  litem  for  each  person  who  has  or  who  may
  thereafter have any interest in the income of such common trust fund and
  a  person  to appear as guardian ad litem for each person who has or who
  may thereafter have any interest in the principal of such  common  trust
  fund.  Each  such  interested  person  may  appear  in  such  accounting
  proceeding  and  on  his  failure  to  appear  shall  be  deemed  to  be
  represented  in such proceeding by the person designated respectively as
  such guardian ad litem.
    Except  as  otherwise  herein  provided,  such  proceeding  shall   be
  conducted  in  the same manner as any other proceeding for the voluntary
  judicial settlement of the account of a testamentary trustee. The decree
  in such proceeding shall be thereafter binding and conclusive in respect
  of any matter embraced in the account or in such decree upon all persons
  having or who may thereafter have any interest in such common trust fund
  or in any participating estate, trust or fund.

    7. As used in this section,  subject  to  subdivision  eight  of  this
  section  the term "trust company" shall mean any trust company, any bank
  duly authorized to exercise  fiduciary  powers  and  any  national  bank
  having  a  principal,  branch  or  trust  office  in this state and duly
  authorized  to  exercise  fiduciary powers; the term "estate" shall mean
  the assets held by an executor or an administrator, with or without  the
  will  annexed, of the goods, chattels and credits of a decedent, but not
  a temporary administrator; the term "trust" shall mean the assets of any
  trust however created  held  by  the  trustee  thereof,  including,  but
  without  limitation,  any assets held by a fiduciary as donee of a power
  during minority to manage property vested in an infant; the term  "fund"
  shall  include the assets of an infant held by the guardian thereof, the
  assets of an incompetent person held by the committee thereof,  and  the
  assets of a conservatee held by the conservator thereof. The term "donee
  of a power during minority to manage property vested in an infant" shall
  for  the purposes of this section include only a fiduciary who has power
  during a period measured by a minority to hold and invest  moneys  under
  the  terms  of  an  instrument under which the fiduciary had theretofore
  held such moneys as executor or as personal or testamentary trustee.
    8. (a) A trust company, at least ninety  per  centum  of  the  capital
  stock  of  which  is  directly or indirectly, or through a subsidiary or
  subsidiaries, owned, controlled or held with power to  vote  by  a  bank
  holding  company  may  establish  and  maintain one or more common trust
  funds and short term investment common trust funds, or may  utilize  one
  or  more common trust funds and short term investment common trust funds
  previously established by it, for funds held in  any  of  the  fiduciary
  capacities  mentioned  in subdivision one of this section, by itself and
  by other trust companies at least ninety per centum of the capital stock
  of each of which is directly or indirectly, or through a  subsidiary  or
  subsidiaries,  owned, controlled or held with power to vote by such bank
  holding company. Each trust company, the capital stock of  which  is  so
  owned,  controlled  or  held,  may invest and reinvest in one or more of
  such common trust funds and short term  investment  common  trust  funds
  moneys  held in any of the fiduciary capacities mentioned in subdivision
  one of this section. The trust company establishing, maintaining, or  so
  utilizing  any  such common trust funds and short term investment common
  trust funds shall comply with, and be subject to, all of the  provisions
  of  this  section  as  though  such  trust  company  and the other trust
  companies participating in such fund were one  and  the  same  corporate
  entity.
    (b)  For  the  purpose of this subdivision, (i) the term "bank holding
  company" shall be  given  the  same  meaning  as  is  contained  in  the
  definition  of  such  term  in  section  one  hundred  forty-one of this
  chapter, except that such definition is  modified  by  substituting  the
  words  "a  banking  institution"  for  the  phrase  "each of two or more
  banking institutions" wherever such phrase appears, and  (ii)  the  term
  "trust  company"  shall be given the same meaning as is contained in the
  definition of such term in subdivision seven  of  this  section,  except
  that  such  term shall be deemed to include, in addition to the entities
  listed in such subdivision, any banking,  trust  or  financial  company,
  corporation  or  association,  organized  under  the  laws of the United
  States, whether or not having its principal office outside  this  state,
  or  of  any  state  of  the  United  States, which is duly authorized to
  exercise fiduciary powers.
    9. (a) As used in  this  subdivision,  unless  the  context  otherwise
  required:
    (i)  "Short  term  investment  common trust fund" means a common trust
  fund maintained and administered by a trust company exclusively for  the

  collective  investment  and  reinvestment  of moneys contributed thereto
  which are invested and reinvested in any  short  term  investment  by  a
  trust company, in its capacity as a fiduciary or co-fiduciary.
    (ii)  "Short term investment" means bonds, notes or other evidences of
  indebtedness which are payable upon demand  (including  variable  amount
  notes)  or  which have a maturity date of one year or less from the date
  of purchase, or which may be prescribed, from time to time, by rules  or
  regulations  promulgated by the banking board, and which are acquired or
  held by a trust company in a short term investment common trust fund.
    (iii) "Participant" means any estate, trust, donee of a  power  during
  minority,  guardianship,  committeeship,  conservatorship,  or custodian
  under any Uniform Transfers  to  Minors  Act  administered  by  a  trust
  company, as fiduciary or co-fiduciary, having a participation.
    (iv)  "Participation"  means  the interest of a participant in a short
  term investment common trust fund.
    (b) Any trust company may administer one or more short term investment
  common trust funds.
    (c) Any trust company shall, at least once each year, cause  an  audit
  of  each  short  term  investment  common trust fund administered by the
  trust company to be made  by  auditors  who  are  independent  certified
  public  accountants.  A  copy  of  such  audit shall be available at the
  office of the trust company maintained  for  the  transaction  of  trust
  business,  during  all  regular  business  hours,  for inspection by any
  person having an interest in any participant, and upon request a copy of
  any such audit shall be furnished without any cost to such  person.  The
  reasonable  expenses  of  any  such  audit made by independent certified
  public accounts or of any  examination  by  the  superintendent  may  be
  charged to the income of the short term investment common trust fund.
    (d) A trust company administering a short term investment common trust
  fund  shall  not be required to render a court accounting with regard to
  such fund.
    10. The banking board shall promulgate such regulations and  rules  as
  it  considers  appropriate  to govern the administration of common trust
  funds and short term investment common trust funds.