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Keywords

trustwill

appealtrustwill

Related Cases

In re Trusts for McDonald, 100 A.D.3d 1349, 953 N.Y.S.2d 751, 2012 N.Y. Slip Op. 07430

Facts

The petitioners, twin sisters, sought to remove their mother as trustee of testamentary trusts created by their grandfather. They claimed that their mother refused to make discretionary distributions for their college expenses and for purchasing automobiles. The trusts allowed the trustee broad discretion in making distributions for the beneficiaries' maintenance, support, education, health, and welfare. At the time of the petition, the sisters were 19 years old, and the mother was also their parent.

Petitioners, who are twin sisters, commenced this proceeding seeking, inter alia, to remove their mother as the trustee of each testamentary trust created for them by the last will and testament of their grandfather, who was the trustee's father.

Issue

Did the trustee abuse her discretion in declining to make distributions from the trusts for the beneficiaries' college expenses and other requests?

Rule

The courts will respect a trustee's decision unless it can be shown that the decision constituted an abuse of the discretion given by the testator, particularly when the testator has granted the trustee broad latitude in exercising discretionary judgment.

As a general rule the courts of this State will respect and not interfere with a trustee's decision unless it can be shown that the decision constituted an abuse of the discretion given the trustee by the testator.

Analysis

The court found that the trustee did not abuse her discretion because she had a New York 529 College Savings account for each petitioner, which had sufficient funds for their college expenses. Additionally, one sister's college costs were covered by public benefits, and the other failed to apply for available assistance. The court emphasized that mere friction between the trustee and beneficiaries is not sufficient grounds for removal.

Here, the record establishes that the trustee, in her capacity as petitioners' parent, was the custodian of a New York 529 College Savings account for each petitioner and that the account balances were more than adequate to provide for petitioners' college expenses.

Conclusion

The Appellate Division reversed the Surrogate's Court's decision, dismissing the petition to remove the trustee and concluding that the trustee acted within her discretion.

It is hereby ORDERED that the order so appealed from is unanimously reversed on the law without costs and the petition is dismissed.

Who won?

The trustee prevailed in the case because the Appellate Division found that she did not abuse her discretion in managing the trusts and that the petitioners' claims were not sufficient to warrant her removal.

The Appellate Division reversed this decision, holding that the mother did not abuse her discretion as trustee.

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Keywords

Related Cases

Baker v. National Sav. & Trust Co., 181 F.2d 273, 86 U.S.App.D.C. 161

Reznik v. McKee, 216 Kan. 659, 534 P.2d 243

Kempton v. Dugan, 224 S.W.3d 83

Matter of Frei Irrevocable Trust Dated October 29, 1996, 133 Nev. 50, 390 P.3d 646

Price v. Abate, 9 So.3d 37, 34 Fla. L. Weekly D502