Final answer:
The trustee must be impartial among beneficiaries unless the terms of the trust specify otherwise. Personal opinions or knowledge of a beneficiary's financial situation should not affect this duty unless the trust expressly permits it.
Step-by-step explanation:
The trustee has a duty to be impartial among beneficiaries unless the terms of the trust alter that duty. This is a foundational principle in the law of trusts, which works to ensure fairness and adherence to the trust's established objectives. The duty of impartiality means that a trustee must balance the interests of different beneficiaries fairly and according to the intentions of the trust's creator, without allowing personal biases or other external considerations to interfere.
Scenarios that could potentially alter this duty include explicit instructions within the trust itself that provide for unequal treatment of beneficiaries or direct the trustee to consider factors beyond pure impartiality. For instance, the grantor might specify that certain beneficiaries receive more due to particular needs or circumstances. However, the trustee's perceptions of a beneficiary's character or financial status, such as knowing that a beneficiary is a spendthrift or has other sources of income, do not inherently justify deviation from the duty of impartiality unless the trust's terms explicitly allow for such considerations.