Trust BCLP

Trust BCLP

trust litigation

Main Content

Need Another Reason To Avoid Mixing Family & Finances?

July 25, 2017

Authors

Luke Lantta

Need Another Reason To Avoid Mixing Family & Finances?

July 25, 2017

by: Luke Lantta

You have a big heart and a little bit of money.  You want to help out a cash-strapped family member, and – “because you’re family” – you don’t put down how much you’ll loan or how it’ll be paid back.  You would hate to do it, but, in a worst-case scenario, you suppose a court could help you get it back.  Through its opinion in Roberts v. Smith, however, the Georgia Court of Appeals may have made it harder to get that money or property back from a family member through an implied trust.

Four siblings arranged to purchase a home for the benefit of one of the siblings.  All of the siblings verbally agreed to contribute money toward the purchase and maintenance of the house.  One of the siblings testified that “[n]obody had a set amount to pay,” and another testified that “we

Read More

Transferring Property To A Trust: It’s Not What You Meant, It’s What You Said

June 21, 2017

Authors

Luke Lantta

Transferring Property To A Trust: It’s Not What You Meant, It’s What You Said

June 21, 2017

by: Luke Lantta

When we put pen to paper, sometimes the words don’t come out right.  If that happens, hopefully there’s an opportunity to explain what we meant.  Most times that’s true – even in estate planning.  For example, we have seen how scrivenor’s errors can be explained.  But, for the second time in less than a year, Georgia has limited the role evidence of the settlor’s intent plays under Georgia trust law. In Gibson v. Gibson, the Georgia Supreme Court strictly applied a statute governing the transfer of property to a trust to determine that mistitled brokerage accounts were never transferred to two trusts regardless of the settlor’s intent.

In Gibson, the Georgia Supreme Court had to decide a number of issues arising out of a divorce.  One of the multitude of issues on appeal was whether

Read More

Beware The Constructive Trust When Relying On ‘Informal’ Estate Distributions

April 6, 2017

Authors

Luke Lantta

Beware The Constructive Trust When Relying On ‘Informal’ Estate Distributions

April 6, 2017

by: Luke Lantta

We like when families can work out their estate disputes outside of the courtroom.  Georgia, for one, embraces the “family settlement doctrine,” where heirs at law can agree to distribute or divide property devised under a will, in lieu of that manner provided by the will.  So, too, families often want to ‘avoid probate’ and ‘informally’ distribute the estate.  As the Georgia Court of Appeals reminded us in Maxey v. Sapp, that’s all well and good until someone doesn’t get what they want or what they thought they were getting.

The Sapps executed a joint will providing that when one of them died the survivor would inherit the other’s property. After the survivor’s death, the remainder of the estate was to be devised and bequeathed to

Read More

House Held In Trust Lost Marital Asset Status

December 22, 2016

Authors

Luke Lantta

House Held In Trust Lost Marital Asset Status

December 22, 2016

by: Luke Lantta

In the afterglow of a wedding, the spouses probably don’t immediately start thinking how the bliss they feel may end spectacularly and expensively.  Chances are they may even start estate planning, thinking how they can seamlessly transfer assets to the other.  In Nelson v. Nelson, a Florida appellate court reminded us that the estate planning choices spouses make, however, have far-reaching consequences if before death they doth part.

Husband and wife bought a house together in California and titled it in both of their names.  They then transferred the home into an irrevocable trust established for the benefit of the wife and her descendants, and named the wife as the sole trustee of the trust.  Husband and wife divorced and a Florida trial court characterized the house as a marital asset subject to equitable distribution.  The Florida appellate

Read More

How Far Can A Grantor Go In Eliminating The Duty To Account?

December 1, 2016

Authors

Luke Lantta

How Far Can A Grantor Go In Eliminating The Duty To Account?

December 1, 2016

by: Luke Lantta

Trusts are often used to transfer wealth privately without the messiness of a public estate administration.  That financial privacy can get blown, however, when trusts become the subjects of very public litigation.  In open court and in publicly available filings, dollar figures, assets, and dirty laundry can get thrown about for anyone to see.  This is especially true in trust accounting actions, which dig into the financials: income, expenses, assets, investment performance, and so on.  In Estate of Fuller, however, the Court of Appeals of Mississippi indicated that a grantor may be able to shroud a trust in greater secrecy through restrictive language in the trust instrument.

The trust at issue was a private trust that provided that the trustee would not “be required to account to any

Read More

When The Power To Amend Doesn’t Actually Mean You Can Amend

October 20, 2016

Authors

Luke Lantta

When The Power To Amend Doesn’t Actually Mean You Can Amend

October 20, 2016

by: Luke Lantta

Circumstances, laws, and taxes all change.  And, when they do, many settlors don’t want their beneficiaries to have to go into court to get permission to roll with the changes.  That’s why you often find a trust provision that permits non-judicial amendments to the trust.  The breadth of these powers to amend differ from a narrow power to amend to a broad power to amend, like the one before the Maryland Court of Special Appeals in Grueff v. Vito.  There, the power to amend a family trust provided:

This Agreement may be revoked, altered or amended from time to time by an instrument in writing, signed by the holders of not less than seventy-five (75%) interest herein and delivered to the Trustee.

The beneficiaries used that amendment power a number of times over the years.

Read More

The Four Corners Of The Trust Instrument Get Tighter

September 28, 2016

Authors

Luke Lantta

The Four Corners Of The Trust Instrument Get Tighter

September 28, 2016

by: Luke Lantta

When a court is called upon to decide a trust dispute, it starts by looking at the intent of the settlor.  Invariably there is some statement about the court being bound by the “four corners” of the trust.  Only if the language within the trust instrument is ambiguous can the court then look at evidence outside of the trust instrument.  Just how serious are Georgia‘s appellate courts when it comes to sticking to the language in the trust instrument? In Jackson v. Nowland, the Georgia Court of Appeals refused to look at outside evidence that created a pretty clear ambiguity with the trust termination language.

The trust at issue contained a provision that the trust would continue during the settlor’s life and until her youngest named family members had reached the age of 27.  Pretty easy,

Read More

Trust Instrument Can’t Completely Insulate Trustee From Liability

September 2, 2016

Authors

Luke Lantta

Trust Instrument Can’t Completely Insulate Trustee From Liability

September 2, 2016

by: Luke Lantta

Settlors often want to give their trustees peace of mind that they can administer the trust without a court looking over their shoulder and second-guessing every act they take.  So, estate planners will often put a broad exculpatory clause in the trust instrument to relieve the trustee from liability for certain actions in administering the trust.  But, just as we have seen in other jurisdictions, in In re Scott David Hurwich 1986 Irrevocable Trust, the Court of Appeals of Indiana recognized that there is a limit as to how far the relief from liability can extend.

A settlor/beneficiary of a trust sued the trustee, alleging mismanagement of trust assets, commingling trust assets with the trustee’s own funds, conversion of trust assets, waste of trust

Read More

Filing Trust Modification As Public Record Started Statute Of Limitations

December 23, 2015

Authors

Luke Lantta

Filing Trust Modification As Public Record Started Statute Of Limitations

December 23, 2015

by: Luke Lantta

Fiduciaries should always be thinking of ways to get the statute of limitations started.  Why have a claim hanging over your head for many years, when you can take actions that shorten the time in which a claim may be brought against you?  Typically, we think of getting that time running in terms of sending regular account statements to the trust beneficiaries.  In Domino v. Braswell, the Court of Appeals of Mississippi got us thinking about another way to start the clock running:  by publicly recording documents.

A grantor, the trustees, and the beneficiaries of a trust modified the trust to correct a clerical error.  The trust modification was filed as a public record in 1997.  After the grantor died, in 2013, a complaint was

Read More

Failure To Fulfill Trust Requirements As Grounds For Trust Termination

November 11, 2015

Authors

Luke Lantta

Failure To Fulfill Trust Requirements As Grounds For Trust Termination

November 11, 2015

by: Luke Lantta

Trust instruments occasionally permit the trustees – sometimes with or without the beneficiaries’ consent – to terminate the trust early under certain circumstances.  Why continue a trust or be forced to go into court when, for example, its purpose has been fulfilled?  The Elaine Radlick-Trupp Revocable Trust gave the trustees broad authority to terminate the trust.  The trustees could discontinue the trust when they determined discontinuance to be justified, when it was not economically sound to continue, or when they determined that termination was in the best interests of the beneficiaries because of unforeseen circumstances.  In the Michigan case of Trupp v. Naughton (unpublished), several of the co-trustees of the trust may have inadvertently triggered the termination provision through their actions.

The trust contained two real properties and we will focus on

Read More
The attorneys of Bryan Cave Leighton Paisner make this site available to you only for the educational purposes of imparting general information and a general understanding of the law. This site does not offer specific legal advice. Your use of this site does not create an attorney-client relationship between you and Bryan Cave LLP or any of its attorneys. Do not use this site as a substitute for specific legal advice from a licensed attorney. Much of the information on this site is based upon preliminary discussions in the absence of definitive advice or policy statements and therefore may change as soon as more definitive advice is available. Please review our full disclaimer.