Justia Trusts & Estates Opinion Summaries

William Watson Eldridge III (Father) created two trusts for the ultimate benefit of his sons, William Watson Eldridge IV (Bill) and Thomas Hadley Eldridge (Tom). In 1973, Father formed a revocable trust (R-trust), for which he was the trustee. When Mother died in 1992, Father amended the R-trust to name Bill and Tom as co-successor trustees. In 1999, Father formed an irrevocable Qualified Personal Residence Trust (QPRT), for which he was trustee, and placed in it a Florida condominium (Florida condo) that he owned. Under the terms of the QPRT, Father could sell the Florida condo, but use of the proceeds was limited to the purchase of a replacement home to be placed in the trust, or the purchase of a separate annuity for the benefit of the trust. The trust document named Sons as co-successor trustees of the QPRT. The terms of the QPRT also provided that if Father died within eight years after its formation, the trust assets were to automatically transfer to the R-trust, of which Sons were beneficiaries. If Father was still living eight years after the formation of the QPRT, the trust assets were to be distributed equally among Sons. Father married Frances Eldridge (Wife) in 2001. Acting as trustee of the QPRT trust, Father sold the Florida condo and used the sales proceeds to buy a Hilton Head home. Instead of titling the Hilton Head home in the name of the QPRT trust, as required under the terms of the trust, he titled it in the name of the R-Trust. In 2003, Father transferred the Hilton Head home from the R-trust to himself and Wife, individually, as joint tenants with the right of survivorship. Father died in 2006, and under the right of survivorship, Wife's sole interest in the Hilton Head home became fully vested. Subsequently, she transferred title in the home to herself as trustee of the Frances Ulmer Eldridge Revocable Trust, of which Wife's children are the beneficiaries at her death. Bill and Tom, as trustees of the R-trust, filed suit against Wife and her trust, claiming that the Hilton Head home was held in either a constructive or a resulting trust for the benefit of the R-trust, and requesting the court to transfer the Hilton Head home to the R-Trust. After a bench trial, the master-in-equity issued judgment in favor of Wife. Upon review, the Supreme Court found that the Sons did not have an adequate legal remedy to cure Father's breach of trust. The law of the case was that a resulting trust arose over the Hilton Head home for the benefit of the R-Trust. Because the Sons filed a claim against Wife and her trust just over a year after Father's death, the Court held that laches could not apply to bar the Sons' claim. Accordingly, the Court reversed and remanded with direction that Respondents execute all documents necessary to re-transfer the Hilton Head home to the R-Trust. View "Eldridge v. Eldridge" on Justia Law

A circuit court found Appellant David Cannon in contempt of court for violating (1) an order mandating that Appellant give up all authority and cease all activities relating to the James Brown estate, the Brown trusts, and all Brown entities (which he violated by filing amended tax returns without authority); and (2) an order requiring Cannon to pay back money he had misappropriated from Brown's estate. The circuit court ordered Appellant to be incarcerated for six months for contempt. However, the circuit court stated Appellant could purge himself of the contempt "by the payment of the aforementioned [money, with a portion] to be applied towards the payment of attorneys' fees incurred by the various parties, and the payment of a fine." The Court of Appeals affirmed in part, reversed in part, and remanded for further proceedings; upholding all of the circuit court's findings regarding the contempt except for the amount awarded towards attorneys' fees and the imposition of the fine. The Court of Appeals found the circuit court abused its discretion as to attorneys' fees because it did not make the necessary factual findings to support the amount awarded, so it "reverse[d] and remand[ed] the issue of attorneys' fees to the circuit court for findings of fact as to the proper amount. On remand, the circuit court held a hearing for the sole purpose of making findings of fact regarding the proper amount of attorneys' fees to be awarded for reimbursing the parties for attorneys' time related to the issue of Appellant's contemptuous conduct, and held that Appellant should pay. Appellant appealed this order, arguing payment of fees was mooted by his serving his jail sentence. The case was transferred from the Court of Appeals to the Supreme Court. Upon review, the Supreme Court affirmed the Court of Appeals, concluding the trial court did not abuse its discretion in ordering Appellant pay attorneys' fees. Further, the Court held that the issue of attorneys' fees was not mooted by Appellant serving his jail sentence. View "Ex parte: Cannon v. Estate of James Brown" on Justia Law

Respondent Deborah Spence alleged that attorney Kenneth Wingate breached a fiduciary duty to her as a former client in its handling of her late husband's life insurance policy. Mr. Spence was a member of United States House of Representatives, and he held a life insurance policy.  Mr. Spence named Mrs. Spence and his four sons from a prior marriage as the beneficiaries of the policy, with all five to receive equal shares of the proceeds. Wingate undertook representation of Mrs. Spence with regards to the assets of her husband, her inheritance rights, and her rights in his estate.  Wingate advised Mrs. Spence that she was entitled to nothing from her husband's estate and that she was barred from receiving an elective share by a prenuptial agreement. Wingate advised Mrs. Spence to enter into an agreement with the four adult sons of Mr. Spence to create a trust to provide her with a lifetime income stream. The trust was to be created and funded from one-third of the value of Mr. Spence's probate estate. Mrs. Spence thereafter came to believe that the amount she received under the agreement negotiated by Wingate was much less than what she was entitled to under the will and its codicil or if she had opted for an elective share. Mrs. Spence thereafter brought a lawsuit to set aside the agreement creating the trust. The agreement was eventually set aside. The circuit court granted partial summary judgment in favor of Wingate and found that, "[b]y statute, [Wingate] owed no duty or obligation to [Mrs. Spence] in connection with the congressional life insurance policy or the manner in which it was paid." The Court of Appeals reversed the grant of summary judgment to Wingate and remanded the matter for trial. Upon review, the Supreme Court concluded Wingate owed a fiduciary duty to Mrs. Spence: "[t]his duty included, among other obligations, the obligation not to act in a manner adverse to her interests in matters substantially related to the prior representation.  … we uphold the decision of the Court of Appeals to reverse the grant of summary judgment and remand this matter for trial.  To the extent the Court of Appeals indicated whether a duty was owed was a question of fact for the jury, the decision is modified to recognize that whether a fiduciary relationship exists between two classes of persons is a matter to be determined by a court."