Category Archives: Fiduciary Litigation

December 5, 2017

Litigating RUFADAA: What is a “communication”?

by Morgan Wiener

I’ve been on a calendar, but never on time.

-Marilyn Monroe

While the Revised Uniform Fiduciary Access to Digital Assets Act (“RUFADAA”) has now been enacted in a majority of states – 17 states have adopted a version of the act so far this year – there has been very little litigation about the act to date.  As a result, there is little guidance from the courts about the interpretation of key terms and how disputes will be resolved.  A recent decision from the New York Surrogate’s Court helps fill in some of the gaps.  In In re Estate of Serrano, 54 N.Y.S.3d 564 (2017), the court interpreted the definition of “communication” in Article 13-A of the Estate’s Powers and Trusts Law (“EPTL”), a New York statute modeled after RUFADAA.

The issue in Serrano involved a personal representative’s request for access to the decedent’s Google email account, contacts, and calendar.  In response to the request, Google asked for a court order stating that “disclosure of the content [of the requested electronic information] would not violate any applicable laws, including but not limited to the Electronic Communications Privacy Act and any state equivalent.”  Id. at 565.  Read more >>

October 9, 2017

Decanting to Eliminate a Beneficiary – New York Says Yes

by Kelly Dickson Cooper

Settlors often ask whether they can change the beneficiaries of an irrevocable trust because life circumstances or relationships have changed. Often, the answer is no.  However, in a recent case in New York, the trustee was able to accomplish the settlor’s desire to disinherit one of his children through a decanting. Read more >>

September 26, 2017

Fifty Ways to Leave Your Lover (or Fifty Ways to Plan, Administer and Litigate Estates)

by Carol Warnick

As the old song by Paul Simon contemplates, there are fifty ways to leave your lover, and there are also fifty ways to plan, administer and litigate estates and trusts.  I have recently become aware of various situations in which attorneys assume that because things are done a certain way in the state in which they practice, they are done the same way in other states.

I am licensed in three states, Colorado, Utah and Wyoming, and deal regularly with the significant differences between them.  For example, Colorado tends to use “by representation” in dealing with passing assets down the generations, but Utah and Wyoming both use “per stirpes.”  Read more >>

September 11, 2017

Fiduciary Duty of Loyalty: Which Interest is Best?

by Matthew Skotak

The term “fiduciary” can be considered a vague term that encompasses many different people and several different relationships.  Under Colorado law, a fiduciary includes, without limitation, a trustee of any trust, a personal representative, guardian, conservator, receiver, partner, agent, or “any other person acting in a fiduciary capacity for any person, trust, or estate.” Colo. Rev. Stat. § 15-1-103(2).  It is within this context that we examine a fiduciary’s duty of loyalty and how best to uphold that duty.

In the context of a trust, and as stated in the Restatement (Second) of Trusts § 2, a fiduciary relationship with respect to property arises out of the manifestation of an intention to create the fiduciary relationship and subjects the trustee “to equitable duties to deal with the property for the benefit of another person.”  From this relationship stems several inherent and implied fiduciary duties.  Generally, the fiduciary duties applicable to a trustee are: the duty of loyalty, the duty to exercise care and skill in managing the trust assets and administering the trust, and the duty to remain impartial to all beneficiaries.   Read more >>

August 28, 2017

Who are the Partners Now?

by Rebecca Klock Schroer

We are often asked as trust and estate litigation attorneys for advice on how to avoid future family disputes with better estate planning.  I want to highlight an issue that seems to be appearing more frequently in disputes involving family partnerships.  When a partner dies, the succession provisions of the partnership agreement can become an issue in litigation when the provisions are not clearly drafted or fail to coordinate with other estate planning documents.

We have had several cases involving whether the decedent’s successors are partners, or simply assignees who do not have all the rights of a partner.  Family partnership agreements may allow for the transfer of a partnership interest to another family member automatically.  Even in these scenarios, there may be technical terms of the partnership agreement that have to be complied with before the family member officially becomes a partner.  Some agreements do not allow anyone to succeed to a partner’s interest unless otherwise determined by the partnership/other partners.  Accordingly, if a partner’s will purports to unilaterally pass a partnership interest to a beneficiary, it may cause a dispute if such a transfer is not allowed by the partnership agreement.  The dispute is often fueled by a beneficiary who asserts that the will is the best evidence of the decedent’s intent. Read more >>

August 2, 2017

New Uniform Directed Trust Act

by Kelly Dickson Cooper

More and more, I review trust agreements that appoint a trustee, but then appoint other individuals or institutions to perform certain tasks that are normally in the domain of the trustee.  They are sometimes referred to as trust protectors, trust advisors, trust directors, special powerholders, investment trustees, or distribution trustees.  I most often see these appointments in the areas of investments or distributions.

The trust language that attempts to divide the responsibilities of a trustee among a group is often unclear and give rise to difficult questions as to the scope of each individuals’ responsibilities.  There is also the question of whether the trustee is responsible for the actions of the other appointees and if the appointees are fiduciaries.  These problems with interpretation are often exacerbated because the laws are not clear about the division of these responsibilities and the liability of each actor.  Read more >>

July 11, 2017

Where Probate Law Meets Family Law

by Rebecca Klock Schroer

I recently joined forces with family law attorney Ian Shea to co-author an article for The Colorado Lawyer.  The article highlights a few of the intersections between probate law and family law, including spouse’s property interests in trusts, the automatic temporary injunction, the revocation of spouse’s interests under the Colorado Probate Code, and representation of fiduciaries in divorce proceedings.

A link to the article is below:

‘Til Death Do Us Part – Where Probate Law Meets Family Law

July 5, 2017

Electronic Wills

by Morgan Wiener

As regular readers of this blog know, one of our favorite topics is digital assets, including estate planning for digital assets.  Today, we’re taking a slightly different focus and discussing developments in digital estate planning, more commonly known as electronic wills.

One of the more recent developments in estate planning is the concept of electronic wills. In general, an electronic will is one that is signed and stored electronically. Instead of signing a hard copy document in ink, the testator electronically signs the will, and it is also signed by witnesses and notarized electronically.  Not surprisingly, companies like LegalZoom are very interested in this topic.

Read more >>

June 12, 2017

IRS Rules on Tax Impacts of Trust Modification

by Kelly Dickson Cooper

In my practice, I regularly answer questions regarding the permissibility and advisability of modifying irrevocable trusts.  With the enactment of a decanting statute in Colorado in 2016, these types of requests will only increase.  One of the major hurdles in modifying irrevocable trusts (and a trap for the unwary) is the potential tax consequences of a modification.  We often have to consider estate tax inclusion issues, the possibility of the imposition of gift taxes due to the modification, and the potential loss of generation-skipping transfer tax exemption for a trust. Read more >>

May 8, 2017

Recent Appellate Opinion Regarding Probate Court Jurisdiction

by Rebecca Klock Schroer

The Colorado Court of Appeals recently issued an opinion reinforcing the breadth of the probate court’s jurisdiction.  In re Estate of Arlen E. Owens, 2017COA53.

In Owens, the decedent’s brother filed a petition to set aside nonprobate payable-on-death (“POD”) transfers, alleging that at the time the decedent executed certain beneficiary designations, he lacked testamentary capacity and was unduly influenced by his caretaker.  The caretaker filed an objection based on jurisdiction, which the court denied.  After an evidentiary hearing on the petition, the trial court set aside the beneficiary designations and imposed a constructive trust over the transferred assets held by the caretaker.  Read more >>