Justia Trusts & Estates Opinion Summaries

In 2006, Redland, acting as a trustee, obtained a reverse mortgage line of credit from FFSF. She owned two parcels. Redland died in 2015. Dupree, an attorney, became the successor trustee. A series of bank failures, corporate acquisitions, and assignments, had occurred in the intervening years. MTC sought to foreclose on both parcels. The Trust, represented by Dupree, filed a complaint, naming FFSF and MTC as defendants (they had been succeeded by other entities), and alleging that the loan was secured only by one parcel. The Trust later added CIT as a defendant. CIT filed a cross-complaint. More than three years after the case was filed, MAM, a successor to CIT and the entity servicing the loan, moved to intervene.The court agreed with MAM that the naming of the Trust as plaintiff meant the action was void and dismissed. MAM argued that Dupree’s subsequent amendment request was tardy and futile because the limitations period had passed. T The court of appeal reversed the denial of leave to amend. The complaint Dupree mistakenly filed in the name of the Trust was presumptively within the court’s subject matter jurisdiction. Such defects do not typically deprive courts of the power to act. An amended complaint relates back to the original complaint's filing and avoids the bar of the statute of limitations if recovery is sought on the same general facts. View "Dupree v. CIT Bank N.A." on Justia Law

In 2002, the decedent wrote a letter purporting to be a will. No one witnessed the deceased sign the will. In the will, the decedent left certain property to her then-girlfriend. The couple broke up in 2003 and the decedent passed away in 2020, at which point her pastor found the letter. The pastor gave a copy of the letter to the decedent's daughters. The ex-girlfriend sought to probate the letter as the decedent's will.Finding that the letter did not comply with the requirements of a will, the probate court declined to probate the letter as the decedent's will.The Second Appellate District reversed the probate court's order declining to probate the letter as decedent's will, finding that a probate court may consider extrinsic evidence of the circumstances surrounding the document’s execution if the intent expressed by the document’s terms is unambiguous. Here, when reviewing the decedent's letter, the Second Appellate District determined that language was sufficient to exhibit her testamentary intent by clear and convincing evidence. View "Estate of Berger" on Justia Law

A trial court disapproved certain disbursements made by the trustee of a special needs trust, and it surcharged the trustee. The trustee appeals, claiming the trial court abused its discretion by imposing the wrong standard for determining whether the disbursements were for the trust beneficiary’s special needs and disallowing expenditures as offsets for the surcharges. Because the trial court abused its discretion by applying the wrong definition of "special needs," the Court of Appeal remanded for the court to exercise its discretion under the proper standard. "In reaching this conclusion, however, we do not mean to be understood as holding that the trust instrument placed no limits on the types of distributions the trustee could make." View "McGee v. State Dept. of Health Care Services" on Justia Law

In this estate action, the Supreme Court reversed and vacated an order of the district court denying a motion to strike notice of disallowance and an order denying the personal representative's motion for summary judgment, holding that the district court lacked subject matter jurisdiction to enter the orders.Carl Scott devised his entire estate to the Rocky Mountain Elk Foundation. After Carl died, David Scott, on behalf of himself and the Estate of Kenneth Scott, filed a creditor claim against Carl's estate for its equity in a family farm. The district court concluded that the Scott Children had a vested interest in the farm's equity and that the Estate was obligated to disburse the funds to them. Thereafter, the Estate issued a notice of disallowance for the Scott Children's claims, arguing that they were equitable and that the district court, while sitting in probate, lacked subject matter jurisdiction. The district court granted the motion. The Supreme Court reversed, holding that the district court (1) lacked subject matter jurisdiction to strike the Estate's notice of disallowance; and (2) erred by ruling on the personal representative's motion for summary judgment. View "In re Estate of Scott" on Justia Law

Plaintiff brought a diversity suit against his former stepfather, Defendant, alleging that Defendant owed him a fiduciary duty to disclose the existence of certain Settlement Funds arising from the wrongful death of Plaintiff’s biological father. The Eleventh Circuit previously certified three questions to the Supreme Court of Georgia regarding breach of fiduciary duty for failure to disclose a claim.
The Eleventh Circuit vacated the district court’s grant of summary judgment to Defendant on the failure to disclose claim and remanded the matter for further proceedings. The court explained that the district court should only have granted Defendant summary judgment if there was no genuine dispute as to any material fact regarding the tort claim and Defendant was entitled to judgment as a matter of law, viewing all evidence and making all inferences in the light most favorable to Plaintiff. Here, a reasonable jury could find the following facts at trial:4 (1) Plaintiff and Defendant were in a confidential or fiduciary relationship such that, under Georgia law, the statute of limitations could be tolled, and a claim for breach of fiduciary duty could be supported; (2) at the time Plaintiff turned 18, at least $50,000 of the Settlement Funds remained in the Charles Schwab account; (3) Plaintiff had a right to take control of the Settlement Funds when he turned 18; (4) Defendant had a duty to disclose the existence of the Settlement Funds and turn over control of those funds to Plaintiff when he turned 18; (5) Defendant failed to do so, and (6) Plaintiff would have taken control of the funds when he turned 18. View "Elkin King v. Forrest King, Jr." on Justia Law

The Settlor of a trust, who is both the trustor and trustee, sought to amend his trust. The trust document provides that to amend the trust, he must send the document by certified mail to the trustee. The Settlor failed to follow this procedure. Thus, the Second Appellate District held that the purported amendment did not conform to the terms of the trust, rendering the amendment invalid. As a result, the trust became revocable upon the Settlor's death. After his death, the Settlor's son found an amendment in a stamped envelope addressed to the Settlor's attorney.The Second Appellate District determined that the trust itself sets forth the terms under which modification is effective. Here, because the Settlor failed to follow the terms of the trust, the amendment was not valid. View "Diaz v. Zuniga" on Justia Law

The Supreme Court affirmed the orders of the district court granting summary judgment and dismissal in favor of a loan servicer and trustee in this case involving a home equity line of credit agreement (HELOC) with a defined maturity date and closed draw period, holding that there was no error.At issue before the Court was whether a loan servicer and trustee were entitled to foreclose upon Borrowers' residence due to Borrowers' failure to repay the funds provided to them under the terms of their HELOC. The Supreme Court affirmed, holding that the district court (1) did not err in determining that Borrowers' HELOC was both a negotiable instrument under Nev. Rev. Stat. 104.3104(1) and a promissory note under Nev. Rev. Stat. 104.3104(5), entitling the loan servicer and trustee to enforce the document under Nev. Rev. Code chapter 104 due to Borrowers' default; and (2) erred in finding that Borrowers' property was not owner-occupied and thus not subject to statutory requirements pertaining to foreclosures affecting owner-occupied housing, but the error was harmless. View "Wishengrad v. Carrington Mortgage Services" on Justia Law

The Supreme Court affirmed in part and reversed in part the judgment of the circuit court denying the motion for partial summary judgment brought by the Estate of Robert T. Lynch as to its action against Kevin Lynch and entering judgment as a matter of law for Kevin on his counterclaim for conversion, holding that remand was required.The Estate sued Kevin alleging claims for fiduciary fraud, conversion, breach of fiduciary duty, and elder exploitation. Kevin filed a counterclaim alleging conversion, among other claims. After the circuit court denied the Estate's motion for partial summary judgment on its claims against Kevin the court entered judgment as a matter of law for Kevin on his counterclaim. The Supreme Court (1) reversed as to the Estate's claims involving two payable-on-death CDs Kevin deposited in his individual account and directed that, on remand, the circuit court shall enter judgment as a matter of law for compensatory damages plus prejudgment interest on the Estate’s claims for breach of fiduciary duty and conversion; (2) ruled that the Estate's claim for punitive damage on the reversed portion of the judgment was an open question on remand; and (3) otherwise affirmed. View "Estate of Lynch v. Lynch" on Justia Law

The United States sued several heirs of A.P., alleging that they were trustees of the trust or received estate property as transferees or beneficiaries and were thus personally liable for estate taxes under 26 U.S.C. Section 6324(a)(2). The United States also alleged that two of the heirs were liable for estate taxes under California state law. The district court ruled in favor of Defendants on the Tax Code claims and in favor of the United States on the state law claims.   The Ninth Circuit reversed the district court’s judgment in favor of Defendants, and remanded with instructions to enter judgment in favor of the government on its claims for estate taxes and to conduct any further proceedings necessary to determine the amount of each defendant’s liability for unpaid taxes. The panel held that Section 6324(a)(2) imposes personal liability for unpaid estate taxes on the categories of persons listed in the statute who have or receive estate property, either on the date of the decedent’s death or at any time thereafter (as opposed to only on the date of death), subject to the applicable statute of limitations. The panel next held that Defendants were within the categories of persons listed in Section 6324(a) when they had or received estate property and are thus liable for the unpaid estate taxes as trustees and beneficiaries. The panel further held that each Defendant’s liability cannot exceed the value of the estate property at the time of the decedent’s death or the value of that property at the time they received or had it as trustees and beneficiaries. View "USA V. JAMES D. PAULSON, ET AL" on Justia Law

Appellant Elkin King sued Appellee Forrest King, Jr., his former stepfather, in federal district court, alleging that Forrest had concealed, misused, and converted the proceeds of a wrongful death settlement that had been placed in an account for Appellant’s benefit when Appellant was a minor, and Forrest was the custodian. Appellant further alleged that Forrest’s actions had allowed Appellant’s mother, Peggy Fulford, to spend the funds remaining in the account after Appellant turned 18 years old. The district court granted summary judgment in favor of Forrest. The United States Court of Appeals for the Eleventh Circuit affirmed summary judgment on the misuse claim and held that Appellant had forfeited his conversion claim. But as to the concealment claim, the Eleventh Circuit certified three questions to the Georgia Supreme Court, seeking clarification of the parameters of Georgia’s duty to disclose in a confidential relationship. The Supreme Court responded to the Eleventh Circuit’s certified questions: when a confidential relationship is also a fiduciary relationship, the fiduciary’s fraudulent breach of the duty to disclose can give rise to a breach-of-fiduciary-duty tort claim if that breach violates a fiduciary’s duty to act with the utmost good faith. "But whether a fiduciary has failed to act with the utmost good faith in a particular circumstance is a question of fact, not law." Accordingly, the Supreme Court answered the Eleventh Circuit’s first question and declined to answer the other two questions. View "King v. King" on Justia Law