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Massachusetts Law Retroactively Giving Inheritance Rights To Adopted Children Ruled Unconstitutional As Applied

Originally published at bryancavefiduciarylitigation.com

We’ve recently looked at the inheritance rights of children adopted out of families here and here, now let’s look at the inheritance rights of children adopted into families.

Big news out of Massachusetts this week, as the Supreme Judicial Court ruled in Bird Anderson v. BNY Mellon, N.A. that a Massachusetts law that had significant implications for trusts and estates planners, fiduciaries, and especially adopted children was unconstitutional as applied to the trust case before it.

Let’s take a look at the law.

The rights of adopted children as “heirs” under Massachusetts law have a long history.

Prior to 1958, Massachusetts had a statute prescribing a rule of construction for certain types of instruments relating to inheritance that provided that unless the contrary “plainly appear[ed] by the terms of the instrument,” an adopted child was excluded from the definition

Georgia Will And Revocable Trust Were Invalid Products Of Undue Influence

From BryanCaveFiduciaryLitigation.com

Let’s just jump right into this one: in 2010, a Houston County, Georgia jury declared that a Will and a Revocable Trust executed by Thomas Hines, Sr., in 2002 were invalid, as they were the product of undue influence.

In Davison v. Hines, the Georgia Supreme Court affirmed the jury verdict.  The reason we just jumped right into the discussion of this case is because undue influence cases are fact-intensive.  So, let’s look at the facts that supported the verdict.

– Thomas’s 2001 will left the bulk of his estate to his wife for her life, and upon her death, divided the estate equally between his sons.  Thomas’s 2002 will, however, gave Steve Davison and his wife, Deborah, control over Thomas’s assets and estate.  Deborah was a granddaughter of Thomas.

– In December 2001, although Thomas didn’t want to move from his home,

Partially Distributing An Illiquid Estate

June 19, 2012

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From BryanCaveFiduciaryLitigation.com

Some personal representatives take the position that they’ll either distribute all or none of the estate. Other personal representatives are willing to make a partial distribution of estate assets only if each beneficiary gets an equal partial distribution. Both situations can be maddening to a beneficiary who just wants to receive something from an estate rather than watch it sit in probate for years until there’s some liquidity.

Often, the personal representative’s justification for not making a partial distribution is illiquidity of estate assets. Where real property is involved, the current real estate market compounds the problem of illiquid estate assets. So, what’s a personal representative to do? A recent opinion out of Missouri gives personal representatives in that state some guidance.

In Estate of Sullivan, the Missouri appellate court had a number of issues before it on appeal.

How To Create A Trust In Delaware

June 18, 2012

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How To Create A Trust In Delaware

June 18, 2012

Authored by: Luke Lantta

From BryanCaveFiduciaryLitigation.com

Bill and Vieve Gore founded a manufacturing company best known for its GORE-TEX fabric. Having become considerably wealthy with more wealth anticipated, they undertook efforts to transfer that wealth without incurring significant estate taxes. Through this process, they signed two separate trust instruments during 1972 – the “May Instrument” and the “October Instrument” – both purporting to transfer the same property into the “Pokeberry Trust.”

One of their daughters claimed that the early May instrument controlled, while the other four children claimed that Bill and Vieve never intended for the May Instrument to be final and enforceable. Litigation ensued . . .

Major Changes In Delaware To Consent Petitions To Modify Trusts

April 23, 2012

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From BryanCaveFiduciaryLitigation.com

Effective May 1, 2012, new amendments to the Delaware Chancery Court Rules will materially change the required content of consent petitions to modify trusts. The official website of the Delaware judiciary describes the amendments as “help[ing] the Court protect trust assets of minor and unborn beneficiaries and ensur[ing] the integrity of the Court in the process of modifying trusts.”

So what’s the big deal? Let’s see . . .

For starters, the petition must specifically cover a lot of ground, including a lot of facts about the history of the trust, and nine separate points that must be pleaded “with particularity” (e.g., how the relief requested will affect current, vested future, and contingent beneficiaries; whether the relief requested will result in releases or indemnification of the fiduciary; and so on . . .).

Here are some other highlights:

  • A whole

Florida Lawyer Who Wore Many Hats Disbarred

April 12, 2012

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From BryanCaveFiduciaryLitigation.com

I don’t want to get into a lot of detail about The Florida Bar v. Doherty, a recent attorney disciplinary proceeding from Florida, but just want to raise it as a cautionary tale for those practitioners who wear multiple hats for the same client.  You know – those practitioners who act as both estate planner and investment advisor for the same client; those practitioners who act as estate planner for a client and then get named as trustee, executor, etc. in that client’s estate planning documents; those practitioners who act as estate planner and annuity salesperson for the same client; and those practitioners who act as attorney and business partner for the same client.

It’s not that you cannot necessarily wear those multiple hats.  It’s just that, if you do, you better strictly follow the applicable rules – including any applicable rules of

Plaintiffs Could Not Challenge Validity Of Trust Without Also Contesting Will

April 12, 2012

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From BryanCaveFiduciaryLitigation.com

Let’s say that you have a will executed in 2005 that provides something like “I give all the residue of my estate, including my homestead, to the Trustee serving under my Irrevocable Trust Agreement dated October 26, 1999, as amended or hereafter amended.”  In other words, you have a trust incorporated into the  will.

Now, let’s say you want to challenge the validity of that trust.  What should you do when you receive a notice of administration regarding that 2005 will?

In Pasquale v. Loving, a Florida appellate court held that, in order to challenge the validity of that trust incorporated into the will, you will first have to pursue remedies available at probate.  That’s what Dominic Pasquale, Jr. and Anthony Pasquale did when they received a notice of administration regarding the administration of the estate of

Diversification And The Prudent Investor Rule

From BryanCaveFiduciaryLitigation.com

We get asked a lot about two categories of cases: (1) cases about discretionary distributions; and (2) cases about concentrations and diversification. And, it’s easy to understand why – fiduciaries are often given a great amount of discretion in exercising their duties, but then may get sued over it. While there seems to be a growing number of decisions dealing with matters like undue influence and lack of capacity, the numbers of authorities regarding the exercise of discretionary powers and diversification/concentrations are still limited.

That’s why when an opinion like that of the Illinois Court of Appeals in Carter v. Carter comes along, we have to take notice. In this case, the court considered a breach of fiduciary duty claim arising from the trustee’s alleged strategy of investing only in tax-free municipal bonds. The appellate court determined that this strategy did not violate the prudent

Do You Really Want Your Trust Instrument To Prohibit Judicial Modification?

February 15, 2012

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From BryanCaveFiduciaryLitigation.com

This week, let’s take a look at another case from Florida.  You see a lot of trust instruments that ‘require’ a “corporate co-trustee.”  There are a lot of good reasons why the grantor may have wanted a corporate co-trustee to serve with a family member, friend, or other co-trustee.

Then again, as time goes by, a corporate co-trustee may no longer make a lot of sense.  It could be that the trust has been substantially administered or that the corpus is so small that a corporate trustee’s fee schedule just doesn’t work.  That’s when the beneficiaries and trustees usually get together and go to court to have the trust modified to permit the corporate trustee’s resignation and have the trust modified either to allow a single trustee or to allow an individual to serve as co-trustee.  These things are often done by consent

2011 Amendments to Delaware Trust Laws

August 10, 2011

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(This post originally appeared on Bryan Cave’s Fiduciary Litigation Team’s Blog.  Please click here to see the original post.)

Effective August 1, 2011, a number of new changes went into effect changing Delaware trust law. While the amendments make a lot of changes to the Delaware trust laws, below are some of the changes that are likely to have the biggest impact on litigation concerning Delaware trusts.

Wrongdoing:  The amendments have added a definition of “wrongdoing” to clarify its meaning within the definition of “wilful misconduct.”  For purposes of Delaware trust law, “wilful misconduct,” means “intentional wrongdoing, not mere negligence, gross negligence or recklessness.”  Apparently, there was some confusion over the meaning of “wrongdoing,” and, therefore, “wrongdoing” is now defined as “malicious conduct or conduct designed to defraud or seek an unconscionable advantage.”  To the extent that previously there was a benign interpretation of