Higgins v. Higgins

The Court of Appeal reversed the trial court's judgment in favor of the wife under Code of Civil Procedure section 631.8, holding that despite the form of the bank accounts, when clear and convincing evidence shows funds were transferred to an account owner to hold in an irrevocable trust for a third party beneficiary and the trustee repudiates the trust, a constructive trust may be imposed on the funds for the beneficiary's estate to prevent unjust enrichment. In this case, the wife agreed to hold funds in trust for her husband's elderly stepmother, she changed the form of the accounts after her husband's death and used the funds for her own purposes, and the stepmother's personal representative filed suit seeking to impose a constructive trust on the funds after the stepmother passed away. The Court of Appeal explained that the wife held the funds in the accounts in trust for the stepmother, and her repudiation of the trust by removing the stepmother's name from the accounts and using the funds for her own purposes was a wrongful act supporting the imposition of a constructive trust. View "Higgins v. Higgins" on Justia Law