Fiduciary and trust litigation can be very complex. In certain trust instruments, a trustee is granted “sole discretion” to do certain things. This language, however, can be very misleading.
Even when a trustee is granted “sole discretion,” a trustee may be liable if the trustee willfully abuses his discretion, acts arbitrarily, fraudulently, dishonestly, or with improper motive. § 456.8-814, RSMo; Commentary to Uniform Trust Code Section 814 (“[d]espite the breadth of discretion purportedly granted by the wording of a trust, no grant of discretion to a trustee, whether with respect to management or distribution, is ever absolute”); Brown v. Brown- Thill, 543 S.W.3d 620, 633 (Mo. Ct. App. 2018).
Further, if a trust instrument supplies a standard by which to evaluate the reasonableness of a trustee’s conduct, a court will interfere if the trustee’s exercise of power is beyond the bounds of reasonable judgment.