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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

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Pennsylvania Court Could Not Assess A Surcharge Against Non-Party Wrongdoer

November 11, 2011

Authors

Luke Lantta

Pennsylvania Court Could Not Assess A Surcharge Against Non-Party Wrongdoer

November 11, 2011

by: Luke Lantta

When individual fiduciaries are found to have breached their fiduciary duties, they are often found to have received some help.  Many times a spouse, lover, or business partner is seen lurking in the wings, aiding and abetting the breach of fiduciary duty.  From an aggrieved beneficiary’s or successor fiduciary’s perspective, it’s imperative to get that joint-wrongdoer brought into court, where he or she can be held to account for the wrongdoing and – if there’s a recovery to be had – reimburse the estate or trust for damages.  In other words, a person cannot be held to account unless he or she is actually a party to the litigation.

In Estate of Brown, the Superior Court of Pennsylvania, decided that the Court of Common Pleas of Delaware County exceeded its authority when it imposed a surcharge on Kenneth Pearl, who was not a party

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