A trustee is required to “keep adequate records of the administration of the trust.” Section 456.8-810, RSMo. This is closely related to the duties to act with prudence and report and inform to the beneficiaries. Failure to follow any of these duties is a breach of trust. It could lead to a damages claim. If…
Legal Articles
Power of Attorney, Successor-in-Interest
Power of attorney litigation is complex. When an agent or attorney-in-fact breaches his or her duty under a power of attorney, the principal has the standing to sue the agent. Can anyone else other than the principal sue? A principal’s “successors in interest” may maintain a lawsuit. “Successors in interest” includes a (1) conservator of…
Fiduciary Litigation, Breach of Fiduciary Duty
The existence of a fiduciary duty is a question of law for the court to decide, while whether a breach of fiduciary duty occurs is a fact question. Scanwell Freight Express STL, Inc. v. Chan, 162 S.W.3d 477, 481 (Mo. 2005). So, in any fiduciary litigation, there are two main steps: (1) establishing that a…
Common Law Fiduciary Duties
Trustees, personal representatives, attorneys-in-fact, corporate directors, limited liability company managers, etc. owe fiduciary duties. Generally speaking, a fiduciary duty is where one person has a legal obligation to act in another’s interests. Whether a fiduciary duty exists is a question of law, while breach of fiduciary duty is usually a question of fact. Scanwell Freight…
Constructive Trust: Unjust Enrichment and Breach of Fiduciary Duty
A constructive trust is an equitable device to “remedy a situation where a party has been wrongfully deprived of some right, title or interest in property as a result of fraud or violation of confidence of faith reposed in another.” Lynch v. Lynch, 260 S.W.3d 834, 837 (Mo. 2008). It may also provide a remedy…
Powers of Attorney, Dealings with Third Persons
While powers of attorney are useful tools to allow one person (the attorney-in-fact) to act another person’s behalf (the principal), third-parties are sometimes distrustful of a power of attorney. A power of attorney is relatively easy to create. There are many forms online, including from state bar associations, that seemingly anyone can print and use….
Breach of Fiduciary Duty/Trust, Causation, Trustee Discretion
Breach of trust is a type of breach of fiduciary duty. “To prevail on a breach of fiduciary duty, a plaintiff must show: (1) the existence of a fiduciary duty; (2) a breach of that fiduciary duty; (3) causation; and (4) harm.” Matter of Wilma G. James Trust, 487 S.W.3d 37 (Mo. Ct. App. 2016)….
Trustee Duty of Loyalty: Trust Opportunities
A trustee’s duty of loyalty extends to beyond assets actually owned by the trust. Thus, a breach of fiduciary duty and the duty of loyalty does not necessarily need to relate to assets owned by the trust. By way of example, a transaction “not concerning trust property in which the trustee engages in the trustee’s…
Shareholder Oppression, Fiduciary Duties
If a plaintiff in a corporation can demonstrate that there is shareholder oppression, then the plaintiff may be entitled to equitable relief. When does shareholder oppression exist? It typically occurs when an action by the majority suggests burdensome, harsh and wrongful conduct; a lack of honesty and fair dealing in the affairs of the company;…
Trustee: Personal Liability
In breach of trust and/or breach of fiduciary suits, whether a trustee is personally liable often comes up. Section 456.10-1010, RSMo provides some points of clarification on the matter: (1) Unless provided otherwise in a contract, a trustee is not personally liable on a contract if the trustee discloses the trustee/fiduciary capacity in the contract….