It is an understatement that the Minnesota Court of Appeals in In re: Amendment and Restatement of Revocable Living Trust of Alfred J. Berget dated February 15, 2005 [A13-2295, Dec. 8, 2014] afforded the trustee who had invested trust assets in annuity contracts the benefit of every doubt: “Although we have some concerns about the suitability of the variable annuities that…[the Trustee]…purchased in light of the purposes of the trust, we are reluctant to conclude that the district court erred by finding that a lay trustee did not breach her fiduciary duties by purchasing them after receiving and relying on professional advice from a financial advisor who previously served as a financial advisor to the grantor of the trust.” The advisor had sold the annuity contracts to the trustee. In light of the agent-liability provisions of §9(b) of the Uniform Prudent Investor Act and the court’s reasonable-reliance dicta, what about an action against the annuity salesman/financial advisor? The topic of third-party liability of a trustee’s agents is taken up in §7.2.9 of Loring and Rounds: A Trustee’s Handbook [pages 795-803 of the 2016 Edition]. The section is reproduced in its entirety below.
Please see full publication below for more information.