Injunction Against Trustee Sought Over $5.3 Million Trust Loan
Obtaining a temporary restraining order against a trustee, or getting an injunction against a trustee is not as easy as just showing up in court and talking. You actually need evidence and you have to often show “irreparable harm”. In Florida courts, like many probate courts, monetary damages, investment losses, cash, money are never “irreparable harm.” Here’s a New York case that dealt with trust beneficiaries who wanted an injunction against their trustee. Trust loans to a money losing business?
- Beneficiaries of a New York trust sued the trustee in a New York probate court (what they call the surrogate’s court)
- Trust beneficiaries didn’t like what the trustee was doing with the Trust Money
Trustee Was Loaning Trust $$ To a Business
- The trustee was transferring or loaning or using trust assets for a business which the trust owned
- The trust beneficiaries objected, claiming that the business was losing money.
Trustees Filed An Accounting
- May 1, 2012: the Trustees filed an accounting
- The Trustees wanted to be discharged or relieved of liability for the time period covered by the accounting
- June 28, 2013: a hearing was held
- July 26, 2013 : Objections to the accounting were filed by the trust beneficiaries
Trust Owned Business Operating at a Loss
- Why would you take trust money and give it to a money losing business?
- Is that what a prudent trustee would do?
Trust Beneficiaries Seek Injunction Against the Trustee
- The trust beneficiaries filed a motion for an injunction: a temporary restraining order
- The beneficiaries of the trust wanted the trustee PROHIBITED from transferring trust funds to the money losing business
While “spending” or loaning “good” trust money after “bad” may not make sense, the request for the trust injunction was denied on technical grounds.
If you are involved in Palm Beach trust litigation and you don’t like the way your Palm Beach trustee is using money, ask your trust litigator about trial strategies. What can you do to prohibit the trustee from acting in a way which may harm the trust? Ask your trust litigator about Florida Trust law in the Florida Trust Code where you have the following options
- Remove the Palm Beach trustee
- Suspend the powers of the Palm Beach trustee
- Have the Palm Beach Probate Court intervene in the administration of the Florida Trust
- Have a temporary trustee appointed
- Have a special trustee appointed with a limited purpose or task — such as to run the business or make or not make loans from trust money
- Obtain a “status quo” order from the Palm Beach Probate Court on the trust assets and spending habits of the Florida Trustee