Is a Florida trustee’s fiduciary duty different from a Florida personal representative’s?  To answer this question, you must first ask what is the difference between a trustee and a personal representative.

A trustee is someone or some entity appointed in a trust to perform the tasks listed in the trust, which typically include the distribution of assets to the beneficiaries and handling any other issues that may arise in the administration of the trust.  A trust is a private document and is usually prepared for tax purposes, creditor protection and avoiding probate.  A personal representative is someone or some entity list in a Will or appointed by the probate court to administer the estate of a deceased person. 

The duties and responsibilities of a trustee and a personal representative are listed in different sections of the Florida Probate Code (Fla. Stat. §§736 and 733, respectively), but Fla. Stat. §733.602(1) states as “a personal representative is a fiduciary who shall observe the standards of care applicable to trustees.”

Although the duties of a Florida trustee and personal representative are listed in different sections of the Code and Florida law goes into much further detail regarding the duties and responsibilities of a trustee, ultimately the law provides that the duties and responsibilities of a trustee and a personal representative are essentially the same and may be used interchangeably.  The Florida law makers believed that because a trustee and a personal representative are appointed with the important job of administering assets and have been trusted with great power and responsibility, it makes sense that each one should be held to similar standards.

For further information regarding the differences between a trustee and a personal representative and whether either one is fulfilling its fiduciary duties, it may be in your best interest to contact a Florida trust and estate lawyer or probate attorney.                 

In a series of overnight accidents in northern Florida, blamed on poor visibility from smoke from a nearby brush fire, authorities said at least ten people were killed in the crashes.  Most of the collisions were on Interstate 75, in Northern Florida according to the Alachua County Sheriff’s Office. Crashes also occurred on U.S. Highway 441 near Gainesville, Florida.  The National Weather Service in Jacksonville had issued a dense smoke advisory due to nearby fires which cut visibility to less than a mile.

Car crashes, motorcycle accidents, medical malpractice, and other tragic events that form the basis of many personal injury lawsuits in Florida.  Where death is involved, they usually include the filing of a claim for damages resulting from the victim’s wrongful death against the negligent person.   Damages based upon wrongful death can include a wide variety of things, from seeking reimbursement for funeral expenses to the long-term loss of parental guidance and support for the decedent’s children. 

Wrongful death litigation can be complicated.  Calculating the monetary damages, including estimating the number of years the decedent otherwise would have lived, is difficult.  Determining what individuals are the proper parties in the wrongful death lawsuit can also be problematic.  For example, a personal representative is the person authorized to file a lawsuit in a wrongful death case.  But who is the proper personal representative?  Sometimes a surviving spouse from a second marriage will file a wrongful death lawsuit and not include the correct beneficiaries. Other times a dispute will exist as to who will serve as the personal representative and thus who will control the decisions and the money from any award of the wrongful death lawsuit.

In an attempt to insure justice when someone’s life has been taken due to the wrongful act of another, specific statutes have been established in the State of Florida.  The Florida law regarding wrongful death has been entitled “the Florida’s Wrongful Death Act” by the Florida legislature, and the Act itself can be found as part of the Florida statutes, in Sections 768.16-768.26 of the Florida statutes’ chapter dealing with Negligence.

Those who may sue under the Florida Wrongful Death Act for compensation under its tenets are defined in the Act as “survivors” under Section 768.20 and are limited to the following people:

• the decedent’s spouse;
• the decedent’s children born of a marriage;
• a decedent mother’s children born out of wedlock;
• a decedent father’s children born out of wedlock if the father, prior to his death, recognized a responsibility for the child’s support;
• the decedent’s parents; 
• any blood relatives partly or wholly dependent on the decedent for support or services;
• any adoptive brothers and sisters partly or wholly dependent on the decedent for support or services.

What monetary awards are available under the Wrongful Death Act have been detailed in the law, as follows (in Section 768.21):

(1)  Each survivor may recover the value of lost support and services from the date of the decedent’s injury to her or his death, with interest, and future loss of support and services from the date of death and reduced to present value. In evaluating loss of support and services, the survivor’s relationship to the decedent, the amount of the decedent’s probable net income available for distribution to the particular survivor, and the replacement value of the decedent’s services to the survivor may be considered. In computing the duration of future losses, the joint life expectancies of the survivor and the decedent and the period of minority, in the case of healthy minor children, may be considered.

(2)  The surviving spouse may also recover for loss of the decedent’s companionship and protection and for mental pain and suffering from the date of injury.

(3)  Minor children of the decedent, and all children of the decedent if there is no surviving spouse, may also recover for lost parental companionship, instruction, and guidance and for mental pain and suffering from the date of injury. For the purposes of this subsection, if both spouses die within 30 days of one another as a result of the same wrongful act or series of acts arising out of the same incident, each spouse is considered to have been predeceased by the other.

(4)  Each parent of a deceased minor child may also recover for mental pain and suffering from the date of injury. Each parent of an adult child may also recover for mental pain and suffering if there are no other survivors.

(5)  Medical or funeral expenses due to the decedent’s injury or death may be recovered by a survivor who has paid them.

(6)  The decedent’s personal representative may recover for the decedent’s estate the following:

(a)  Loss of earnings of the deceased from the date of injury to the date of death, less lost support of survivors excluding contributions in kind, with interest. Loss of the prospective net accumulations of an estate, which might reasonably have been expected but for the wrongful death, reduced to present money value, may also be recovered:

1.  If the decedent’s survivors include a surviving spouse or lineal descendants; or

2.  If the decedent is not a minor child as defined in s. 768.18(2), there are no lost support and services recoverable under subsection (1), and there is a surviving parent.

(b)  Medical or funeral expenses due to the decedent’s injury or death that have become a charge against her or his estate or that were paid by or on behalf of decedent, excluding amounts recoverable under subsection (5).

(c)  Evidence of remarriage of the decedent’s spouse is admissible.

(7)  All awards for the decedent’s estate are subject to the claims of creditors who have complied with the requirements of probate law concerning claims.

(8)  The damages specified in subsection (3) shall not be recoverable by adult children and the damages specified in subsection (4) shall not be recoverable by parents of an adult child with respect to claims for medical negligence as defined by s. 766.106(1).

 Our firm regularly demands jury trials in probate matters.  There are a variety of reasons for doing so, including the simple fact that it is a constitutional right of all citizens to preserve and guarantee a trial by jury in all proceedings.  Also important is the fact that jury trials are vital to maintaining the public’s confidence and trust in our judicial system.  The value of jury trials in probate has become even more critical with the dramatic decline in the number of jury trials in recent years.

One of the evolving and developing areas of the law that assists probate litigators in providing access to jury trials is the theory of liability founded in what is referred to as “tortious interference with an inheritance” or “intentional interference with an expectancy.”   Our firm regularly handles these cases on behalf of relatives who have been victimized by some unscrupulous person who has interfered with an elderly loved one’s traditional testamentary wishes.  The unscrupulous conduct takes many forms, but typically involves the changing of the title and ownership of assets using a power of attorney, assisting an elderly person with the preparation of a new will, or the changing of bank accounts so that the elderly person’s assets do not pass to the family upon death. 

These actions are for money damages and persons who make these claims are guaranteed a right to a jury trial under the state constitution.

A trustee of a trust has several duties and obligations to the beneficiaries in administering a trust, including but not limited to: administering the trust in good faith, in accordance with its terms and purposes (Fla.Stat. §736.0801); a duty of loyalty and to administer the trust solely in the interests of the beneficiaries (Fla.Stat. §736.0802); the trustee shall act impartially in administering the trust property giving due regard to the respective interests of multiple beneficiaries (Fla. Stat. §736.0803); in administering a trust, the trustee shall only incur expenses that are reasonable in relation to the trust property, the purposes of the trust and the skills of the trustee (Fla. Stat. §736.0805); a trustee shall keep clear, distinct, and accurate records of the administration of the trust (Fla. Stat. §736.0810); a trustee shall keep the qualified beneficiaries of the trust reasonably informed of the trust and its administration (Fla. Stat. §736.0813). A violation by a trustee of a duty the trustee owes to a beneficiary is a breach of trust. In the event a breach of trust occurs, or may occur, the court has several actions it may take to remedy a breach of trust.

Florida Statute §736.1001(2), “Remedies for breach of trust,” provides a non-exclusive list of those actions the Court may take to remedy a breach of trust. The Court may:

a) Compel the trustee to perform the trustee’s duties;

b) Enjoin the trustee from committing a breach of trust;

c) Compel the trustee to redress a breach of trust by paying money or restoring property or by other means;

d) Order a trustee to account;

e) Appoint a special fiduciary to take possession of the trust property and administer the trust;

f) Suspend the trustee;

g) Remove the trustee as provided in s. 736.0706;

h) Reduce or deny compensation to the trustee;

i) Void an act of the trustee, impose a lien or a constructive trust on trust property, or trace trust property wrongfully disposed of an recover the property or its proceeds; or

j) Order any other appropriate relief.

            In addition to the above list of actions a court may use to remedy a breach of trust, it may also find that a trustee who commits a breach of trust is liable for the greater of the amount required to restore the value of trust property and trust distributions to what they would have been if the breach had not occurred including lost income, capital gain, or appreciation that would have resulted from proper administration; or the profit the trustee made by reason of the breach. (Fla. Stat. §736.1002).

            If you as a beneficiary of a trust have been damaged by a breaching trustee, do not despair as there are several remedies at the court’s disposal. The Court has full discretion when fashioning the appropriate relief based upon the unique facts of your case and the specific damages you have incurred. An experienced trust litigation attorney can present your facts and the necessary evidence the Court will require to determine what specific relief is most appropriate to remedy the specific breaches committed by your trustee.

The Notice of Administration is a formal document that notifies all interested parties of the death of the decedent, the filing of the last will and testament for probate, and that an objection to the validly of the will and the probate proceedings must be filed within a certain period of time or be forever barred.

The recipient of a Notice of Administration may have a variety of legal bases (e.g., Lack of Mental Capacity, Undue Influence, Duress, Intentional Interference with an Expectancy, and/or Improper Signing of the Will) to try to stop the administration of the estate or the challenge the validity of the Will.  If you receive a Notice of Administration informing you that you have a limited time-frame, the Notice provisions will override any deals, promises or assurances that if you don’t contest the will you will get your fair share.  So be wary of any promises made that things will be “evened out” in the estate or someone will “take care of it” – those verbal agreements are unenforceable.  In other words, once you are served with a Notice of Administration and the time period (usually 20 days) passes, any promises, representations or guarantees to settle any estate dispute or disagreement are worthless and unenforceable.

Impartial – unable to perceive any promise of personal advantage from espousing either side of a controversy.  Ambrose Bierce

Recently, the problem of a trustee financially favoring one beneficiary over another presented itself.  In this case, the trustee was making distributions to one beneficiary without question, while denying the other beneficiary of similar distributions.  When this occurs, it is imperative that a competent attorney review the trust document and any amendments to the trust to determine if there exists any specific language allowing for the inequity in distribution.  If no such language exists, then the trustee has breached their fiduciary duty of impartiality to the beneficiaries of the trust.

Florida Statute 736.0803 states that “[i]f a trust has two or more beneficiaries, the trustee shall act impartially in administering the trust property, giving due regard to the beneficiaries’ respective interests.”   The trustee cannot favor one beneficiary over the other, unless there is language in the trust document that allows the trustee to do so.

Also, the Uniform Trust Code Section 803 states that the duty of a trustee to act impartially does not mean that the trustee is required to treat the various beneficiaries equally.  Rather, the trustee must treat the beneficiaries equally in light of the purposes and terms of the trust.  The Restatement (Third) of Trusts, Section 79(2) states that the trustee has a duty of loyalty which is the specific duty to treat all trust beneficiaries impartially, that is, not favor one beneficiary over another unless authorized to do so by the governing instrument. 

Even when so authorized, the trustee’s discretionary acts favoring one beneficiary over another must be in furtherance of the intentions of the settlor/grantor and not in furtherance of the trustee’s own personal biases and preferences.  The trustee must be impartial when dealing with conflicting equitable interests of beneficiaries.  Therefore, a trustee must deal impartially with the trust beneficiaries, treat them even-handedly, and act in the best interest of the trust as a whole.  Friedman v. Friedman, 844 So.2d 789 (Fla. 4^th DCA 2003); Morse v. Stanley, 732 F.2d 1139, 1145 (2d Cir. 1984). 

If you believe a trustee is breaching their fiduciary duty to act impartially, it is imperative that you have a competent attorney review the trust documents to determine the specific intentions of the settlor/grantor.  If you find that the trustee did, in fact, breach their fiduciary duty to act impartially, and the trustee has favored one beneficiary over another, then it may be necessary to commence litigation in order to remove the trustee, have a successor trustee appointed, and have the trust disbursements equalized between the beneficiaries.

It is not uncommon for people to place real estate in a trust as part of their estate plan. What happens when the person dies and the real estate is unproductive or the value gets reduced?  Recently a client had a one-half interest in a trust that was to last for several years, the primary asset of which was a house.  The owner of the house wanted it to be available for his sibling to use after his death.  Unfortunately, the house had fallen behind in monthly dues with the homeowner’s association and was not used or lived in after the death of the owner.  Of course, expenses (such as property taxes and homeowner’s dues) needed to be paid and the homeowner’s association sued for past due bills.

Fortunately, Florida law permits the Court to modify an irrevocable trust if not inconsistent with the settlor’s (the creator of the trust) purpose and the purposes of the trust have been fulfilled or have become illegal, impossible, wasteful or impractical to fulfill.  The law allows for modification of the trust for other reasons as well.  The law even allows termination of the trust, in whole or in part!

The client feared that the expenses on the real estate would greatly diminish his interest in trust when it ended after the set term of years.  Fortunately, through application of Florida Statute 736.04113, we were able to request the trust be terminated and the real estate sold, with the proceeds distributed in accordance with the terms of the trust.  This use of the probate law in Florida worked to our client’s advantage and allowed the settlor’s intent to be followed.  This is a great example of how circumstances can change after signing estate planning documents, but with the help of an experienced probate attorney everyone was pleased with the outcome.

“Decanting” is the legal term used to describe the distribution of trust property from one trust to another trust pursuant to the trustee’s discretionary authority to make distributions to or for the benefit of one or more beneficiaries.  Common law provides authority for trust decanting, but several states – including Florida – have codified the common law.  Florida Statute §736.04117 became effective on July 1, 2007.

Under common law, a trustee with absolute power to invade principal is the equivalent of a donee of a special power of appointment.  Restatement (Second) of Prop.: Donative Transfers §11.1  Absent a contrary provision in the governing document, a donee of a power of appointment may exercise such power in a manner which is less extensive than authorized by the instrument creating the power.  Thus, “the rationale underlying decanting is that if a trustee has the discretionary power to distribute property to or for the benefit of one or more current beneficiaries, then the trustee, in effect, has a special power of appointment that should enable the trustee to distribute the property to a second trust for the benefit of such beneficiaries.”  William R. Culp, Jr. & Briani Bennett Mellen, Trust Decanting: An Overview and Introduction to Creative Planning Opportunities, Real Property, Trust and Estate Law Journal, Spring 2010, p. 3. The theory is that if there is authority to distribute outright, then there is authority to distribute in further trust. Alan Halperin and Michelle R. Wandler, Decanting Discretionary Trusts:  State Law and Tax Considerations, 29 Tax Management Estates, Gifts & Trusts Journal, 219, 221 (2004).

In 1940, the Supreme Court of Florida considered whether a trustee, who was specifically authorized by the trust document to appoint the trust property among beneficiaries in whatever proportions he desired in his sole discretion, could create a second trust for the benefit of the beneficiaries funded with property distributed from the first trust.  Phipps v. Palm Beach Trust Co., 196 So. 299 (Fla. 1940).  In Phipps, the settlor, Margarita Phipps, created a trusts for the benefit of her four children.  She named Palm Beach Trust Company and her husband as co-trustees.  Her husband was given a personal power of appointment, exercisable during life by written instrument delivered to the corporate trustee or at death in his Last Will & Testament, in favor of the four children and/or their descendants in whatever proportions as he shall determine.  In compliance with the express terms of the trust, Mr. Phipps provided written directions to the corporate trustee to create a second trust for the descendants.  The corporate trustee, in an abundance of caution, brought a suit in equity praying for construction of the original trust. 

The Phipps court held that the creation of the second trust was permissible because the trustee had both a lifetime and a specific testamentary power to direct distributions to trust beneficiaries.  Ergo, the trustee’s power was a power of appointment instead of a discretionary power to distribute trust property.  The Phipps holding does not provide authority for the position that a trustee with a purely discretionary power held in a fiduciary capacity can transfer assets to a new trust.  Florida Statute §736.04117 codifies the principal holding in Phipps. 12 Fla.Prac., Estate Planning §6:41 (2010-2011 ed.).  In summary, the statute provides that a trustee who has absolute power under the terms of the trust to invade principal may make distributions to a second trust if those beneficiaries include only those beneficiaries of the first trust without reducing any fixed income interest.  The exercise of the decanting power is to be done by an instrument in writing, signed and acknowledged by the trustee and filed with the records of the first trust.  Additionally, the trustee shall notify all qualified beneficiaries of the first trust, in writing, at least 60 days prior to the effective date of the trustee’s exercise of the power to invade the principal and must set forth the manner in which the trustee is planning to exercise the power.  The trustee’s notice under this section shall not limit the right of any beneficiary to object to the exercise of the trustee’s power to invade the principal.  Fla.Stat. §736.04117.

Procedurally, the documents employed for a trust decanting should be similar to those used with respect to a resolution to distribute property.  A written document providing the terms of the trustee’s discretionary exercise of the power to decant should set forth the terms of the exercise of the power to appoint trust property further in trust.  It should set forth background information or recitals identifying (1) the current trustees of the original trust and the trustees that are exercising the decanting power (2) when the original trust was formed and by whom (3) the relevant terms of the original trust (4) the trustee’s authority for the decanting, whether pursuant to statute or the trust instrument, and (5) the appointee trust that will receive trust property from the original trust.  The decanting document should also include trustee resolutions designating and appointing assets of the original trust to the appointee trust and directing the appointed assets be held in accordance with the appointee trust.  William R. Culp, Jr. & Briani Bennett Mellen, Trust Decanting: An Overview and Introduction to Creative Planning Opportunities, Real Property, Trust and Estate Law Journal, Spring 2010, p. 43.

by Jan-Hendrick Frank, Esq.

This article provides an introduction to the recognition of German Wills in Florida.

German Wills:  Formal requirement under German law

Under the German Civil Code (“BGB”), the testator can choose between two forms of traditional wills (§2231 BGB): 1) The public or notarized will (§2232 BGB), and 2) the holographic or handwritten will (§2247 BGB). Witnesses are not required for the validity of a holographic or notarized will under German law. Unlike the U.S., witnessed wills are uncommon in Germany.  

State of Florida

According to 732.502 (2), Fla.Stat., a will must be in writing, signed by the testator and authenticated by two witnesses. A holographic will is without force or effect under Florida law. There is no regulation with regards to foreign wills. However, if the decedent died domiciled in Germany, it may be valid under the applicable terms of the German civil code. Additionally, from the perspective of a German court it may be valid (see decision of the German supreme court, BGH IV ZR 135/03) and, thus, it may be advisable to sue in Germany.

Recognition of a German hand-written will (holographic will): A German hand-written will not authenticated by two witnesses is therefore to be considered formally invalid in the state of Florida (Schuler v. Salathe, 703 So.2d 1167 (1997)) as far as Florida law applies.

Recognition of a German notarial will (notarized will):  A German notarized will not authenticated by two witnesses is therefore to be considered formally valid in the state of Florida as far as Florida law applies.

Look at the experience level of the attorney. Does the lawyer focus their area of legal practice to probate, trusts and estates?

Review the information on the firm’s Web site.  Does the information look relevant and focused?

Ask for referrals…especially former clients.

Contact The Florida Bar to confirm the lawyer is in good standing.

Investigate whether the law firm has good infrastructure.  Ask about support staff, technology, billing practices and procedures for attorney/client communication.