3.4 Traditional Trust Sense
Neither under the Uniform Trust Code, or at common law, is good faith used in the contract law sense. Although “good faith” forms an important role under the Uniform Trust Code, it is not a defined term and one would expect the courts to continue to use the extensive body of the common law of trusts for an understanding of its sense and definition.[1] Whether in the context of a non-modifiable baseline rule under Section 105(b)(3) or when defining the limits of absolute discretion under Section 814(a), good faith under the Uniform Trust Code should be understood in its traditional trust sense. It approximates the common law of trusts and, by wedding good faith to the settlor’s intent and the interests of the beneficiaries, it dances back to a general fiduciary duty that cannot be modified by the terms of the agreement: “[A] settlor may not so negate the responsibilities of the trustee that the trustee would no longer be acting in the fiduciary capacity.”[2]