Remedying wrongful interferences in the making of gifts, whether outright or in trust: Equity’s venerable unjust enrichment jurisprudence, not tort law, is where to start.

Charles E. Rounds, Jr. - Suffolk University Law School
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Deep In the bowels of the Restatement (Second) of Torts (1979), specifically § 774B, is some law that is poorly coordinated with prevailing relevant equity doctrine. Here it is: “One who by fraud, duress or other tortious means intentionally prevents another from receiving from a third person an inheritance or gift that he would otherwise have received is subject to liability to the other for loss of the inheritance or gift.” The title of the section is Intentional Interference with Inheritance or Gift. The problem is that when it comes to wrongful interference in the making of a gift, whether outright or in trust, equity’s venerable and comprehensive unjust enrichment jurisprudence is generally far better equipped to fashion and execute a workable remedy, absent special facts. Assume a property owner is induced by someone’s fraud, duress, undue influence, or mistake not to make a completed donative transfer of the property to a trustee for the benefit of Jack. The property owner dies. The property ostensibly passes to Jill, the property owner’s only heir at law. If Jill had had something to do with the inducement, even if she had not, in equity she has been unjustly enriched. If she will not voluntarily transfer legal title over to the express trustee for the benefit of Jack, the equity court will secure Jack’s equitable property rights by impressing a constructive trust on the property. It will then order her, the constructive trustee, to personally make restitution by transferring the legal title to the property to the express trustee for the benefit of Jack. As a matter of substantive law, the enrichment is unjust in that it has no justifiable basis in law and equity. Donative intent, for example, is lacking. The procedural equitable remedies are the constructive trust and the in personam specific performance order. The substantive equitable remedy is the restitution.

Now back to the Restatement (Second)’s tort of intentional interference with inheritance or gift. The wrongful inducement is fraud, duress, or “other tortious means.” This tort-within-a-tort circularity is unfortunate. But it gets worse. The accompanying commentary incorrectly assumes that equity’s remedy of restitution is not as capacious as it actually is, that it is limited only to situations where it is the “wrongdoer” who is unjustly enriched. See cmt. e. Not so, as we noted above in Jill’s case. Moreover, equity’s unjust enrichment doctrine captures not only the fruits of culpability but also the fruits of innocent mistake. Think the UPS package that has been mistakenly delivered to the wrong address.

All this having been said, at the margins the tort of intentional interference with inheritance or gift may be helpful in filling in some minor gaps in equity’s remedial regime. Think an action in tort against the wrongdoer for the costs of the unjust enrichment action. Or the situation where neither the one unjustly enriched nor the enrichment itself is anywhere to be found. The victim’s recourse then would be an action at law for damages against the wrongdoer, there being no adequate remedy in equity. None of this marginal utility is readily discernible from a reading of the text of § 774B and its accompanying commentary. The Restatement’s law-equity coordination leaves much to be desired. That is why one court at least has taken the bull by the horns and declined to go the tort route unless or until all equitable remedies have been exhausted, thus standing on its head the maxim “Equity follows the law.” See Kinsel v. Lindsey, 526 S.W.3d 411 (Tex. 2017).

So, why all this wheel re-inventing and absence of serious law-equity coordination? Simply put: The law schools are no longer exposing their students to critical equity doctrine, doctrine that is of profound real-world utility. Torts is one of the few “doctrinal” subjects that has not been “reformed” out of the required curriculum, or out of the curriculum altogether. And as for the bar exam, forget about it. It is no wonder, then, that “when modern, Realist-trained lawyers see a setback connected to antisocial conduct, they instinctively reach for tort.” See Goldberg and Sitkoff, Torts and Estates: Remedying Wrongful Interference with Inheritance, 65 Stan. L. Rev. 335, 397 (2013). In §8.15.78 of Loring and Rounds: A Trustee’s Handbook (2022) we trace the evolution of the concept of unjust enrichment from Roman times down to the present. The section is reproduced in its entirety in the appendix immediately below. The 2022 Edition of the Handbook is available for purchase at https://law-store.wolterskluwer.com/s/product/loring-rounds-a-trustees-handbook-2022e-misb/01t4R00000OVWE4QAP.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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