The trustee-beneficiary relationship can be a little bit like a marriage, so perhaps it’s not surprising that the phrase “speak now or forever hold your peace” has meaning for both.  If a trustee commits a breach of trust, a beneficiary may expressly or impliedly demonstrate satisfaction with the wrongful act thereby preventing that beneficiary from later challenging the act.  In other words, the beneficiary may ratify the trustee’s wrongful or unauthorized act by expressly agreeing to it or by failing to object to it.  In order for a beneficiary to ratify a breach of fiduciary duty, typically there must be proof that the beneficiary had full knowledge of all material facts.  All the more reason for trustees to consider giving beneficiaries more information about the trust administration and the trustee’s actions.  If the beneficiary gets the material information and

It’s a rare occurrence that someone would seek to not inherit assets from an estate.  But, if the heir has a judgment against him or her that would be satisfied by that inheritance, then there may be a reason to try to avoid taking from the estate.  What rights might a creditor have to force a reluctant heir to take estate property to satisfy the creditor’s judgment against the heir?  In Estate of Pawlik, the Court of Appeals of Minnesota told us how it works in Minnesota.

In Minnesota, a judgment creditor of an heir has a property right in a decedent’s estate if the judgment could be satisfied by the heir’s inherited property.  Thus, that creditor is an interested person who has standing to bring a petition for determination of descent under the applicable Minnesota statutes.

Part of the challenge of trust and estate planning lawyers is trying to anticipate the ways in which the words in an instrument will be construed down the road.  And there’s no shortage of creativity on the part of those who try to construe these instruments a certain way.  Take for example a trust amendment.  If a grantor wants to unambiguously supplant prior language in his or her trust instrument, should the grantor merely “amend” the paragraph or should the grantor explicitly “revoke and replace” the paragraph?  Does it make a difference?

In In re The H & A Neumann Revocable Trust (unpublished), the Court of Appeals of Minnesota found that it didn’t make a difference – the language was supplanted.  A beneficiary of a trust claimed that when the grantors “amended”

Knowing when to initiate guardianship proceedings for a loved one can be a difficult and personal decision.  When it comes to substance abuse, those proceedings can enter a grayer area than proceedings involving dementia, injury, or developmental disability.  At what point is an addict or alcoholic incapacitated?  What happens during moments of sobriety?  In In re Guardianship of Esterly (unpublished), the Court of Appeals of Minnesota dealt with some of these difficult questions.

Calculating damages in breach of fiduciary duty cases can be tricky business.  The aggrieved trust beneficiary is going to make a claim that the trust assets should have (or would have but for the breach of duty) been invested in some high earning funds that beat the S&P, while the fiduciary is going to claim that a money market rate is the only reasonable measure of damages.  In In re Harry Inge Baker & Jeanne C. Baker Trust dated August 9, 1988, the Minnesota Court of Appeals gives us some guidance on bridging that gap.

When it comes to property taxes, a fiduciary usually ends up having to balance some interests.  An executor or trustee may want to cut the tax bill for real property held by the estate or trust, but that means establishing a lower fair market value of the real property.  A recent case out of Minnesota, In re Estate of Wingen, reminded us of that tension.

James R. Franta named Roberta Peery as the personal representative of his estate.  But a Minnesota district court determined that she was “unsuitable” for appointment under the Uniform Probate Code.  In In re Estate of James R. Franta, the Minnesota Court of Appeals agreed.  Why wouldn’t these courts uphold the decedent’s intent?

A trustee‘s intent is an awfully important thing, but for some reason it often gets forgotten or ignored by courts, lawyers, and litigants.  An area in which the trustee’s intent and the four corners of the trust instrument may be most at risk is when the parties in trust litigation start hammering out a settlement agreement.  What deference is given the trust instrument when the parties settle trust litigation?

In In re the Matter of the Frank J. Rekucki, Sr. Revocable Trust under agreement dated September 8, 1997 (unpublished), the Court of Appeals of Minnesota answered that question under Minnesota law: a lot.