Blogs from July, 2015


Choosing someone to act as your successor trustee upon your death or incapacity is not a decision that you should take lightly. Not only does that nominated successor trustee have a duty and obligation to carry out your wishes, but that trustee also has a fiduciary obligation to act prudently and appropriately for the benefit of the subsequent beneficiaries. However, what if that nominated successor trustee turns out to be a bad choice? What if the settlor of the trust is determined to be incapacitated and cannot alter the terms of the trust?

The 5th District Court of Appeals of Florida in Rene v. Sykes-Kennedy, 156 So.3d 518 (Fla 5th DCA 2015) recently dealt with such an issue wherein a person who created a revocable trust was subsequently determined to be incapacitated. The person had nominated a granddaughter to serve as the successor trustee of the trust upon the person’s death or incapacity. When the guardianship was initiated as a result of the person’s incapacity, the guardian alleged that there were concerns regarding the ability and the appropriateness of the granddaughter having control over the person’s revocable trust. The guardian successfully petitioned the Court to alter the terms of the trust that nominated the granddaughter as the successor trustee. As a result, the guardian was appointed to serve as the successor trustee. The granddaughter subsequently appealed that Order to the 5th District Court of Appeals.

Fla. Stat. §736.0602 (6) states as follows:

 A guardian of the property of the settlor may exercise a settlor’s powers with respect to revocation, amendment, or distribution of trust property only as provided in s. 744.441.

Fla. Stat. §744.441 states that a guardian, after obtaining court approval and authorization, may do the following:

(19) Create or amend revocable trusts or create irrevocable trusts of the property of the ward’s estate which may extend beyond the disability or life of the ward in connection with estate, gift, income, or other tax planning or in connection with estate planning.

As a result, the 5th District Court of Appeals upheld the lower court’s decision which allowed the guardian to alter the nomination of the successor trustee. It is interesting to note that this was done without any judicial findings that the granddaughter had actually done something wrong or otherwise inappropriate. All that is required in order for a guardian to obtain court approval to alter the terms of a ward’s revocable trust is that such alteration be “in the best interest of the ward.” Such a phrase can be utilized and conform to any number of different circumstances and a judicial determination will vary from case to case.


Most Recent Posts from July, 2015