Three attorneys from Huth, Pratt & Milhauser Law Firm in Boca Raton, FL: Brandan J. Pratt, Zander J. Retamar, and Michael W. Kirshon successfully obtained a million-dollar judgment in a trust dispute between a son and daughter involving allegations of breach of trust and breach of fiduciary duty. The parents of the son and daughter had established separate trusts during their lifetime. The father died and the mother was serving as sole trustee of both trusts. Then, the daughter took control of both trusts as sole trustee. The mother was the sole beneficiary of her lifetime, with the son and daughter as residuary beneficiaries.
After two days of trial, the presiding Judge found in favor of the son. The evidence presented at trial demonstrated that when the daughter started serving as trustee, each trust consisted of approximately 1 million dollars – mainly Oil & Gas stocks. The mother was in assisted living and the dividends from the large amount of Oil & Gas stocks maintained her customary standard of living. At trial, testimony was presented from the financial advisor that reflected that the daughter made significant cash transfers to her son directly from the trusts. Aside from cash transfers, the daughter took out a margin loan against the Oil & Gas stocks in order to fund her son’s business venture. The evidence and testimony suggested that none of the funds from the margin loan were utilized for the benefit of the mother. In addition, the trial court found that the daughter was frequently utilizing trust assets deposited to a joint account to pay for her personal expenses. Later, the decrease in oil prices forced a margin call of the Oil & Gas stocks and the entirety of the remaining stock was forced to be liquidated. Later, there were no assets left in the trusts. The son successfully argued that the transfers made by the daughter as trustee presented an inherent conflict of interest, constituted a serious breach of fiduciary duty to the mother, and had the stock not been liquidated due to the margin call, the son would have inherited significant assets under the Trust agreement. The trial court agreed and awarded the son a total of $1.15 Million in damages.
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