In the most recent installment of the McGuireWoods Fiduciary Advisory Services annual multipart series on recent fiduciary cases, developments in the law concerning various topics are examined through the following:
- Kroll v. New York State Dept. of Health, 39 N.Y.S.3d 183 (Oct. 5, 2016); see also In re Kroll, 971 N.Y.S.2d 863, 865 (Sur. Ct. 2013) Court approves “decanting” of a trust to effectively remove a beneficiary’s future mandatory withdrawal right, thereby allowing the beneficiary to continue to qualify for governmental benefits.
- Pfannenstiehl v. Pfannenstiehl, 55 N.E.3d 933 (Mass. April 5, 2016) In divorce action, present value of a husband’s beneficial interest in a discretionary trust is not included in the parties’ divisible marital estate, overturning lower appellate court that held that the value was included.
- Ex Parte Scott, No. 1140645, 2016 WL 6310771 (Ala. Oct. 28, 2016) Courts exercise in rem jurisdiction when supervising ancillary administration of an estate; therefore, an Alabama court overseeing the probate of an English decedent’s U.S. assets lacked the authority to require the U.S. beneficiaries to pay distributions from the decedent’s English estate into escrow to satisfy the administration expenses of the Alabama personal representative.
- Jackson v. Nowland, 338 Ga. App. 614, 791 S.E.2d 190 (2016) In determining the proper interpretation of a document, the “four corners” rule forbids parol evidence of the settlor’s intent if there is any way to reconcile the provisions of a trust instrument so as to avoid the alleged ambiguity.
- Grueff v. Vito, 229 Md. App. 353, 145 A.3d 86, cert. granted, 150 A.3d 819 (Md. 2016) A Maryland appeals court invalidates an amendment to an irrevocable trust made by three beneficiaries eliminating the interest of the fourth beneficiary because an amendment to an irrevocable trust cannot violate a material purpose of the settlor.
- In re Estate of Jameson, 2016 WL 4249142 (Sup. Ct. NJ Aug. 12, 2016) Court dismisses daughter’s petition to overturn a will that disinherited her for allegedly discriminatory reasons.
- Stephenson v. Prudential Ins. Co. of Am., 2016 U.S. Dist. LEXIS 123888 (M.D. Fla. Sept. 13, 2016) Insurance company permitted to interplead life insurance proceeds when beneficiary undetermined under the slayer statute.
- U.S. v. Johnson, 118 A.F.T.R.2d 2016-6781; 2016-2 USTC P 60 (2016) Executors and Trustees are not personally liable for unpaid estate taxes because the trust assets were included in gross estate under Code § 2033, rather than Code § 2034 to §2042, and because the Executors obtained a valid special lien under Code § 6324A.
- Mennen, et al. v. Fiduciary Trust International of Delaware, C.A. No. 8432-VCL (Delaware, February 27, 2017), see also C.A. No. 84832-ML (Delaware, April 24, 2015) Beneficiaries of a trust cannot pierce the co-trustee’s own spendthrift trust to collect damages awarded against the co-trustee for fiduciary breaches.
- King v. Shou-King Wang, 663 Fed. Appx. 12; (August 26, 2016) Beneficiaries are allowed to bring federal RICO claim against defendants for allegedly depriving beneficiaries of interest in decedent’s estate.
- Wang v. New Mighty U.S. Trust, 843 F.3d 487 (D.C. Cir. 2016) A “traditional trust” assumes its trustee’s citizenship for purposes of diversity jurisdiction.
- Shu v. Wang, Civil Action No. 10-5302, 2016 WL 6080199 (D.N.J. Oct. 17, 2016) Case involving Taiwanese parties and applying Taiwanese law is dismissed pursuant to doctrine of forum non conveniens.
- Kozel v. Kozel, Case No. 8:16-cv-1384-T-36TGW, 2016 WL 4163562 (M.D. Fla. Aug. 4, 2016) The citizenship of all of a defendant trust’s members determines the citizenship of a trust defendant for purposes of diversity jurisdiction.