News & Analysis as of

Trustees Breach of Duty

Winstead PC

Presentation: Bad Boys, Bad Boys: Ramifications for Intentional Breaches of Fiduciary Duties by Trustees

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On May 9, 2025, David Johnson gave his presentation “Bad Boys, Bad Boys: Ramification for Intentional Breaches of Fiduciary Duties by Trustees,” to the Corpus Christi Estate Planning Council. This presentation addressed the...more

Gordon Rees Scully Mansukhani

Kositzka v. Fick: Key Lessons on Trustee Fiduciary Duty in Virginia Trusts

In a recent decision, the Court of Appeals of Virginia upheld a lower court’s ruling that Kositzka, Wicks and Company (KWC) breached its fiduciary duty to Edward Joseph Ryan, awarding his estate $999,050 in damages, attorney...more

Winstead PC

Does a Trustee Have A Duty to Investigate Whether the Trust Document is Valid?

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Elderly persons often sign new estate documents, including trusts and trust amendments. Certainly, all persons with competence and without improper influences have the right to leave their property to whoever, and however,...more

Walkers

Retiring trustee – reasonable security and retention of assets

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Under section 43(b) of the Trusts (Guernsey) Law, 2007, when a trustee resigns or is removed it may require that it be provided with reasonable security for liabilities before surrendering trust property....more

Charles E. Rounds, Jr. - Suffolk University...

When Hostilities Break Out Between Co-trustees, Where Does That Leave Trust Counsel?

When hostilities break out between individual co-trustees, incumbent trust counsel faces a representation conundrum. In §8.8 of Loring and Rounds: A Trustee’s Handbook (2025), see appendix below, we grapple with the...more

Charles E. Rounds, Jr. - Suffolk University...

Individual Trustee Delegates to Financial Institution the Job of Taking Custody and Keeping Track of Income and Principal: The...

While PC software programs are a practical improvement over the trustee’s hard-copy ledger book, when it comes to keeping track of trust income and principal these programs still require serious clerical monitoring on the...more

Charles E. Rounds, Jr. - Suffolk University...

Due to scrivener negligence, the dispositive provisions of a trust fail to reflect the deceased settlor’s wishes: Can it be that...

Assume the deceased settlor of a trust had intended that his niece be included in the beneficiary class, but his estate-planning attorney had negligently made no provision for her in the governing instrument. After settlor’s...more

Winstead PC

Court Holds That Contingent Remainder Beneficiary Has Standing To Sue Trustee For Breach Of Fiduciary Duty

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In In re Est., the court of appeals dealt with whether a contingent beneficiary can file claims against a trustee. No. 02-23-00104-CV, 2024 Tex. App. LEXIS 1878 (Tex. App.—Fort Worth March 14, 2024, no pet.)....more

Charles E. Rounds, Jr. - Suffolk University...

When the centerpiece of a trustee’s defense in a breach-of-fiduciary-duty action is an empty file cabinet and a general lack of...

An incident of the trustee’s duty to be generally prudent, to account (or report) to beneficiaries, and to refrain from breaches of the duty of undivided loyalty, such as engaging in unauthorized self-dealing, is the...more

Saul Ewing LLP

Tips for Trustees: Avoiding Breach of Fiduciary Duty Claims

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For many clients, the inclusion of revocable and/or irrevocable trusts as part of their overall estate plan is an important feature. Revocable trusts can allow for probate avoidance and estate tax planning, whereas...more

A&O Shearman

Eighth Circuit Reverses Jury Verdict For Aiding And Abetting Ponzi Scheme, Holding That In Pari Delicto Defense Barred Bankruptcy...

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On September 12, 2024, the United States Court of Appeals for the Eighth Circuit reversed a trial court decision that had rejected a bank’s assertion of the in pari delicto defense to aiding and abetting claims brought by the...more

Downey Brand LLP

No Such Thing as a Free Ride: Section 859 Awards Can Now Go To Whoever Does the Work

Downey Brand LLP on

Newcomers to probate litigation are frequently surprised by how differently things work in probate court, as opposed to your more straightforward civil courts. (And how do those newcomers know how civil courts work?  Law &...more

Winstead PC

Court Affirmed The Removal Of An Executor For Gross Mismanagement

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In Gordon v. Gordon, a couple created a revocable trust and named a friend, who provided financial advice, as successor trustee. No. 03-22-00454-CV, 2024 Tex. App. LEXIS 3611 (Tex. App.—Austin May 23, 2024, no pet. history)....more

Mayer Brown

UK Supreme Court Clarifies Basis of ‘Knowing Receipt’ Claims Arising From Breach of Fiduciary Duty

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"The law on 'knowing receipt' has perplexed judges and academics alike for several decades" – Lord Burrows (paragraph 99). In a decision with significant implications for claims involving fraud and breach of fiduciary duty...more

Conyers

Trustee's Duty and Anti-Bartlett Clauses - The Ivanishvilli Redux

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Just when trustees are feeling safe to go back into the water after the Hong Kong Court of Final Appeal spoke in Zhang Hong Li v. DBS Bank (Hong Kong) Ltd [2019] along comes Ivanishvilli v. Credit Suisse Trust Ltd [2023]...more

Winstead PC

Court Affirmed Award Of Damages And Punitive Damages Against A Trustee Due To A Breach Of The Duty To Disclose, Held That A Trust...

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In Mendell v. Scott, a decedent had a trust that named him as primary beneficiary, and upon his death, the trust would continue for a niece provided that she did not commit a prohibited act. No. 01-20-00578-CV, 2023 Tex. App....more

Walkers

Shades of grey? Unfair prejudice and derivative actions in Jersey following Ntzegkoutanis v Kimionis

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Matters of law will certainly not always be black and white, however, the Courts have adopted a traditional approach when assessing matters of mismanagement or misconduct by directors in relation to company – if there is...more

Winstead PC

Court Held That The TCPA Does Not Apply To Claim Involving Texas Trust Code Section 113.28 And Suits Against Third Parties

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In McCoy v. McCoy, trust beneficiaries sued the trustee for breaching his fiduciary duties by pursing claims against a third party when they instructed him not to do so. No. 08-23-00119-CV, 2023 Tex. App. LEXIS 6604 (Tex....more

King & Spalding

Kansas Federal Court Allows Developers’ Tort and Contract Claims to Proceed Against Bond Trustee

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On September 13, 2023, the U.S. District Court for the District of Kansas granted in part and denied in part UMB Bank’s motion to dismiss counterclaims for tortious interference, breach of contract, and breach of the duty of...more

Winstead PC

Court Affirms Receivership In Trust Case Based Solely On An Alleged Failure To Disclose And Did Not Require Traditional Equitable...

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In Moody Nat’l Bank v. Moody, a beneficiary sued a trustee regarding several allegations of breach of fiduciary duty. No. 14-21-00096-CV, 2022 Tex. App. LEXIS 7844 (Tex. App.—Houston [14th Dist.] October 25, 2022, pet....more

Proskauer - Employee Benefits & Executive...

District Court Replaces Plan Trustees With Independent Fiduciary

In Su v. Fensler, No. 22-cv-01030, 2023 WL 5152640 (N.D. Ill. Aug. 10, 2023), the court granted the Department of Labor’s motion for a preliminary injunction to replace with an independent fiduciary the trustees of the United...more

Goodwin

Second Circuit Rules that Syndicated Loans Are Not “Securities” Under State and Federal Law

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On August 24, 2023, the U.S. Court of Appeals for the Second Circuit in Kirschner unanimously  held that notes evidencing syndicated loans do not plausibly qualify as “securities” covered by state and federal securities laws...more

Winstead PC

Court Affirms Finding Of An Oral Trust And Breach Of Duty By The Trustee

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In Ahlgren v. Ahlgren, plaintiffs sued a defendant alleging that the defendant was a trustee of an oral trust who breached duties by refusing to return certain property. No. 13-22-00029-CV, 2023 Tex. App. LEXIS 4182 (Tex....more

King & Spalding

Aiding and Abetting Breach of Fiduciary Duty Claims Against Lender Survive Motion to Dismiss

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On April 26, 2023, the U.S. Bankruptcy Court for the District of Delaware denied in part and granted in part motions to dismiss a chapter 7 trustee’s breach of fiduciary duty and aiding and abetting claims. The defendants...more

ArentFox Schiff

Minority Business Owners and Trust Beneficiaries May Be Able to Obtain Otherwise Privileged Documents

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In certain circumstances, shareholders of corporations and members of limited liability companies can obtain confidential communications between corporate management and the company’s attorney that would otherwise be...more

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