How is Prudent Person defined in a legal contract?
- Prudent Person means a responsible individual who uses good judgement when it comes to managing practical issues. Their actions are guided by common sense and any situation similarities are taken into consideration to gauge the reasonableness of their actions. Seen in 2 SEC filings.
- Prudent Person means a responsible party with a duty to manage one's obligations towards their beneficiaries. They must exercise their roles with care, skill, diligence, and prudence that a similar person would demonstrate while managing a venture with similar characteristics and objectives. Seen in 2 SEC filings.
- Prudent Person means a trustee who responsibly and fairly executes trust powers in light of the interests of income or principal beneficiaries or both. Their actions should be a reflection of ordinary prudence, diligence, discretion, and judgment, similar to how an average person would act while managing their own affairs. Seen in 1 SEC filing.
Note: The Genie AI Legal Assistant pulled this data out of the SEC EDGAR Database of 500,000 records from the past 22 years of filings. We regularly update this page as new filings and definitions come in.
Search EDGAR for 'Definitions of prudent person' yourself to verify these results. We are always keen to point people to source documents.
Which definition should you use?
🤔 Our AI Legal Assistant has combined and improved the above descriptions to create market-standard 'Genie definitions' below, with guidance on which documents and which industry to use for each.
Genie Definition 1
Prudent Person means an individual who applies common sense and good judgement in handling practical matters.
Relevant Contract Types
Relevant Circumstances
- In terms of risk management
- For decision-making roles
- Assigning responsibilities
Relevant Sectors
Genie Definition 2
Prudent Person means a trustee who exercises trust powers responsibly, considering the beneficiaries' interests, just as an average person would manage their own affairs.
Relevant Contract Types
Relevant Circumstances
- Identifying executor of will
- Trust Management
- Distributing assets to beneficiaries
Relevant Sectors
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Prudent Person means an individual who applies common sense and good judgement in handling practical matters.
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