(a) No financial institution or officer or employee thereof shall be deemed or implied to be acting as fiduciary or have a fiduciary obligation or responsibility to its customers or to other parties, other than shareholders of the institution, unless there is a written agency or trust agreement under which the financial institution specifically agrees to act and perform in the capacity of a fiduciary. The fiduciary responsibility and liability of a financial institution or any officer or employee of a financial institution shall be limited solely to performance under the contract and shall not extend beyond the scope of the contract. Any claim for a breach of a fiduciary responsibility of a financial institution or any officer or employee thereof may only be asserted within the time provided in § 48-18-601.
Terms Used In Tennessee Code 45-1-127
- Bank: means any person, as hereinafter defined, doing a banking business subject to the laws of this or any other jurisdiction and, for the purposes of supervision, examination and liquidation, includes industrial investment companies and industrial banks authorized by chapter 5 of this title. See Tennessee Code 45-1-103
- Company: includes a bank, trust company, corporation, partnership, association, business or other trust, or similar business entity. See Tennessee Code 45-1-103
- Contract: A legal written agreement that becomes binding when signed.
- Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. Source: U.S. Courts
- Fiduciary: A trustee, executor, or administrator.
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- National Bank: A bank that is subject to the supervision of the Comptroller of the Currency. The Office of the Comptroller of the Currency is a bureau of the U.S. Treasury Department. A national bank can be recognized because it must have "national" or "national association" in its name. Source: OCC
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Savings and loan association: includes a building and loan association, a federal or state savings and loan association, a federal savings bank, and any other financial institution, the accounts of which are insured by the federal savings and loan insurance corporation (FSLIC) or any successor of such corporation. See Tennessee Code 1-3-105
- State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
- written: includes printing, typewriting, engraving, lithography, and any other mode of representing words and letters. See Tennessee Code 1-3-105
(b) For purposes of this section, “financial institution” means a state or national bank, a savings and loan association, savings bank, industrial loan and thrift company, or mortgage lender.
(1) It is the legislative intent that this section is not intended to restrict, alter, or modify a court’s application of the equitable doctrines of resulting or constructive trusts.
(2) It is the further legislative intent that this section shall be applied only to transactions or relationships that are entered into after May 10, 1994; provided, that any transaction or relationship that may have existed prior to May 10, 1994, may be ratified, altered, or amended by meeting the requirements of this section.