The Price of Breach of Trust
February 7, 2017 § Leave a comment
The law of trusts in Mississippi may be the least litigated area of our jurisprudence, judging from the paucity of reported cases on trust issues.
That’s why I was planning to do a post on the COA’s recent 30-page decision by Judge Barnes in Cassibry v. Cassibry, decided January 24, 2017. But Philip Thomas posted about the case on his excellent Mississippi Litigation Review and Commentary blog, so you can read his take at this link. At the trial level, the trustee was found to have violated the trust and was assessed a judgment in the amount of $144,865.86, plus post-judgment interest of eight percent per annum, and was ordered to pay $17,902 in costs and $28,500 in attorney’s fees. He was also ordered to transfer 7,757 shares of stock to the prevailing party. On appeal the COA affirmed but remanded for further proceedings on the issue of attorney’s fees, which the appellee conceded was not properly documented at trial.
One minor quibble with Mr. Thomas’s post: he refers to the trial court’s ruling as a “verdict,” but since it came from a chancellor and not a jury, it was a judgment. Not intended as a swipe at the knowledgeable Mr. Thomas. Just pointing this out for the young chancery lawyers and law students. Mr. Thomas will tell you that he spends most of his time in federal and circuit court, and not in chancery, so he can be forgiven the lapse into his more familiar verbiage.
Many trusts are extra-judicial, grant extremely broad discretion to the trustee, and waive accountings and other reporting. I guess that’s why relatively few are litigated. I had a case in my court years ago in which the beneficiary claimed a breach of trust because the trustee refused to disburse any money to him at all. The trust specifically gave the trustee unfettered discretion in that regard. The beneficiary also complained that the trustee had sold some of the assets of the trust; however, the trust gave him broad discretion in that area, also. The case fell to summary judgment and, to my knowledge was never appealed. It would have been interesting to litigate, since the were conflicting provisions as to which state’s laws controlled, and none of them were Mississippi.
An epic case in which the trustee was removed for non-monetary breach of duty to the beneficiaries is Wilbourn v. Wilbourn, decided April 24, 2012.