Florida Constructive Trust

WHAT IS A CONSTRUCTIVE TRUST?

             A Constructive Trust is an equitable remedy and is created when a court, through application of a legal fiction, deems property formerly held by one who wrongfully obtained the property, to be held in Trust for the one who the property justly belongs to be the beneficiary of the Trust.  Unlike other Trusts, a Constructive Trust is not predicated upon the party’s intent.  It is an equitable remedy and a tool used by courts to prevent someone from being unjustly enriched at the expense of an innocent victim.

            American Jurisprudence follows two distinct paths of reasoning with regards to the creation of a Constructive Trust.  One school of thought holds that a Constructive Trust arises when a transaction procured by fraud requires a court to impose a remedy of a Constructive Trust.  Another school of thought (and the one followed by Florida courts) holds that a Constructive Trust is not a Trust at all,  but is merely a remedy imposed by a court when asked to do so by a beneficiary who has been victimized by some inequitable and unjust conduct.  This is the minority view in the United States and is still followed by Florida courts.

            The Second District Court of Appeals recently reaffirmed this minority view of the law when it dealt with the allegations in a complaint that attempted to set forth a cause of action for a Constructive Trust.  In Swope v. Harmon (Fla.2nd DCA 2D11-3228, March 28, 2002) 37 Fla.L.Weekly D725, the court faced an appeal by Plaintiff after the trial court had dismissed the complaint finding that the plaintiff failed to allege sufficient facts to satisfy all the requirements for imposition of a Constructive Trust.  The Second District Court of Appeal affirmed the result but for different reasons then those stated by the trial court.  According to the Second District Court of Appeals, “A Constructive Trust is not a traditional cause of action; it is more accurately defined as an equitable remedy.”  The Court also stated that “because a Constructive Trust is a remedy, it must be imposed based upon an established cause of action.”

            Probate litigators who frequently face situations where an innocent party has been victimized by a wrongdoer, (and the wrongdoer has possession of property that does not rightfully belong to them through using undue influence, fraud, duress or coercion of another by changing a Will or Trust or some other unscrupulous conduct,) are equipped with the extraordinary remedy of Constructive Trust.  This equitable remedy can be critical in achieving justice for victims of undue influence and other tortious conduct in connection with the interference with the family’s inheritance and expectancy.

 

Be Sociable, Share!

Get Legal Help Now