Justia Trusts & Estates Opinion Summaries

Articles Posted in Kentucky Supreme Court
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The Supreme Court reversed the opinion of the circuit court affirming the district court's order liquidating a trust's assets, holding that the order was arbitrary, unreasonable, unfair, and unsupported by sound legal principles.J.P. Morgan Chase Bank, N.A., obtained a Jefferson District Court Court order that improperly directed the Bank to liquidate certain trust assets and pay them into the Jefferson Registry of Court. The circuit court affirmed the district court's action. The Supreme Court reversed, holding (1) the Bank violated its statutory and fiduciary duties by liquidating the trust's assets when the legislature has provided an adequate mechanism and remedy for the settlement and distribution of trust assets; and (2) as a remedy, the district court is to order an accounting and appropriate damages. View "Estate of Worrall v. J.P. Morgan Bank, N.A." on Justia Law

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The Supreme Court reversed the decision of the court of appeals affirming the judgment of the circuit court declaring that the Estate of Nannie Wethington had no dower right pursuant to Ky. Rev. Stat. 392.020 in $38,500 withdrawn from the bank account of her husband, James Wethington, by their son, Kerry Wethington, two days prior to James' death, holding that the lower courts failed to apply controlling precedent.In Kentucky, a widow has an absolute estate to one-half of the personalty of her deceased widow's estate. In this instant case, the circuit court found that James made a valid inter vivos gift to Kerry and that Nannie had no dower right to the $38,500 withdrawn from James's bank account. The court of appeals affirmed. The Supreme Court reversed, holding that the gift of $38,500 was presumptively fraudulent, and the evidence conclusively proved the presumption. The Court remanded the case with instructions that Nannie's estate be distributed the amount of the gift which would satisfy her fifty percent statutory share. View "Simpson v. Wethington" on Justia Law

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The Supreme Court reversed the judgment of the court of appeals affirming the order and judgment of the circuit court enforcing a settlement agreement, holding that the Statute of Frauds was applicable in this case.After a dispute over an alleged forgery in a will, the parties reached a mediation agreement as to certain property. The trial court adopted the mediation agreement as part of its judgment and ordered it to be enforced. The court of appeals appealed, ruling that the Statute of Frauds was not applicable. The Supreme Court reversed, holding that the Statute of Frauds was applicable, barring enforcement of the agreement. View "Adamson v. Adamson" on Justia Law

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The Supreme Court affirmed the opinion of the court of appeals reversing the judgment of the circuit court dismissing Plaintiffs' second action against Defendants, the trustees of their parents' trust, because a prior action had been filed in and decided by the district court, holding that Plaintiffs' filing in the circuit court was appropriate under the circumstances.In the earlier action, Plaintiffs filed a notice-order-motion to remove trustees and for other relief, alleging breach of fiduciary duties. The district court denied the requested relief. The circuit court affirmed. While Plaintiffs' appeal was pending in the circuit court they filed the instant proceeding in the circuit court alleging that Defendants breached their statutory and common law duties. Defendants filed a motion to dismiss and remand to the district court on the grounds that Ky. Rev. Stat. 386B.2-030 vested the district court with exclusive jurisdiction over matters arising from the same trust matter which had been before it. The circuit court denied the motion but remanded the matter to the district court, concluding that the district court had exclusive jurisdiction. The court of appeals reversed. The Supreme Court affirmed, holding that the underlying matter and claims in the two cases were different, and therefore, Plaintiffs' filing in the circuit court was appropriate. View "Hauber v. Hauber" on Justia Law

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The Supreme Court reversed the decision of the Court of Appeals determining that the Jefferson Circuit Court had concurrent jurisdiction over Appellee's breach of trust claims, holding that the Jefferson District Court has exclusive jurisdiction of all breach of trust claims arising out of a Ky. Rev. Stat. 386B.8-180 proceeding.Appellant was trustee of a revocable trust. Pursuant to section 386B.8-180, Appellant filed a petition in Jefferson District Court to approve its statutory notice informing Appellee that a different entity had accepted appointment as the new trustee. Appellee then filed an action in Jefferson Circuit Court alleging several breach of trust claims and filed for removal of the district court action to circuit court. The circuit court denied Appellant's motion for dismissal of the circuit court action. Appellant petitioned for a writ of prohibition, alleging that the circuit court lacked subject matter jurisdiction. The Court of Appeals denied the petition in part, concluding that concurrent jurisdiction existed for the breach of trust claims brought under the separate circuit court action. The Supreme Court reversed, holding that because Appellant followed the proper statutory procedure, any matters within Appellee's circuit court breach of trust action identical to those raised in the section 386B.8-180 proceedings were exclusively within the jurisdiction of the district court. View "PNC Bank, National Ass'n v. Honorable Edwards" on Justia Law

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The Supreme Court affirmed the opinion of the court of appeals reversing in part the judgment of the circuit court in favor of the Contestants in this will-contest case, holding that the court of appeals erred by failing to apply the appropriate standard of appellate review of the trial court's denial of the will-proponent's directed-verdict motion.In reversing the circuit court's judgment in favor of the Contestants, the court of appeals found that the Contestants' evidence at trial was insufficient to support the jury's verdict. The Supreme Court reversed the opinion of the court of appeals and reinstated the jury's verdict on the will-contest issues but otherwise affirmed, holding that the court of appeals erred by failing to apply the appropriate standard of appellate review of the trial court's denial of the will proponent's directed verdict motion. View "Getty v. Getty" on Justia Law

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In 2001, John Bays and Carole Kiphart, who were married, executed reciprocal wills. Carole also obtained two life-insurance policies with the benefits payable to John and their minor son. In 2007, after Carole was diagnosed with cancer, she executed a new will that largely disinherited John. Carole then created two trusts, removed John as a beneficiary on the life-insurance policies, and named the trusts as the beneficiaries. After Carole died, John renounced the will, elected to take his spousal share, and sought to recover the portion of his spousal share that may have been delivered to various legatees under the will and to the beneficiaries of the life insurance policies. John’s theory was that there was fraud on his statutory spousal interest because the beneficiaries of the insurance policies had been changed and the trusts established without his knowledge or consent. The circuit court found in John’s favor with respect to the claimed fraud on his statutory spousal interest. The court of appeals reversed. The Supreme Court affirmed, holding that where a dying spouse exercises her right to change the beneficiary on her life-insurance policy and instead names a trust for the benefit of the minor child of the marriage, the surviving spouse cannot claim fraud on his statutory spousal interest. View "Bays v. Kiphart" on Justia Law

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While he was married to Barbara Van Buskirk, Richard Van Buskirk established an Individual Retirement Account (IRA) with the Dreyfus Family of Funds. Richard identified Barbara as the beneficiary on the account. When Richard and Barbara divorced in 1997, a property settlement agreement entered into by the parties was incorporated into the final divorce decree. Richard died in 2011. Ruth Ann Sadler, Richard’s widow and the administratrix of his estate, filed a motion to intervene in the Van Buskirks’ final divorce action so that she could request a declaration of rights that Barbara had no rights to Richard’s Dreyfus IRA account. The trial court granted Ruth Ann’s motion to intervene but denied her motion to declare that Barbara had no rights to Richard’s IRA, concluding that the agreement was silent with respect to the beneficiary interest in Richard’s IRA and, therefore, the account designation naming Barbara as the beneficiary governed the dispute. The court of appeals affirmed. The Supreme Court reversed, holding that the agreement clearly and unambiguously assigned the full and exclusive ownership interest of the Dreyfus IRA to Richard, and the agreement correspondingly prohibited Barbara from asserting any interest in the IRA owned by Richard. View "Sadler v. Buskirk" on Justia Law

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Ky. Rev. Stat. 386.180 mandated that testamentary trustees make a choice of compensation between either an annual fee or a fee at the termination of the trust. Plaintiffs were the beneficiaries of testamentary trusts managed by Trustees. The Caperton Trust, managed by PNC Bank, operated under a termination-fee compensation option, and the Jarvis Trusts, managed by National City, operated under an annual-fee option. After the General Assembly repealed section 386.180 in 2008, the Trustees brought a declaratory judgment action seeking a judicial determination of whether the repeal of the statute affected their compensation, where the two trusts at issue were in existence for many years before the statute was repealed. The trial court granted the Trustees' motion for summary judgment, concluding that the repeal of section 386.180 eliminated all restrictions on the calculation of trustee fees. Plaintiffs appealed. The Supreme Court affirmed, holding that the repeal of section 386.180 was complete and unlimited, and therefore, trustees of testamentary trusts could collect reasonable fees on trusts that predated the repeal of the statute. View "Jarvis v. Nat'l City" on Justia Law

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Appellant was sentenced to life imprisonment for the murder of Christina Wittich. Wittich's parents brought a wrongful death action against Appellant on behalf of their daughter's estate (Estate) and obtained a multi-million dollar jury verdict. Appellant appealed, naming only "the Estate of Christina Wittich" as a party to the appeal. The court of appeals dismissed the appeal for failure to name the co-administrators of the Estate. The Supreme Court reversed the dismissal, holding that Appellant's error in the notice of appeal as not fatal to the appeal, as naming "The Estate of Christina Wittich" provided sufficient notice to the co-administrators of the Wittich Estate, conferred jurisdiction over the co-administrators, and identified the proper party to the appeal. View "Flick v. Estate of Wittich" on Justia Law