In Rotstain v. Trustmark Nat’l Bank, plaintiffs sued banks for assisting Stanford and his entities regarding a Ponzi scheme. No. 3:09-CV-2384-N, 2022 U.S. Dist. LEXIS 10332 (N.D. Tex. January 20, 2022). Stanford and the entities under his control sold fraudulent certificates of deposit (“CDs”) issued by the Antigua-based Stanford International Bank Limited (“SIBL”). The CDs paid relatively high rates of interest, but SIBL claimed it deployed the funds raised from CD sales only in low risk, high return funds. In reality, the CD proceeds were used to finance Stanford’s own extravagant lifestyle, and to pay off previous investors. In this suit, the plaintiffs allege that the defendant financial institutions provided banking services that supported and furthered Stanford’s scheme. Continue Reading Federal Court Denies Defendant Banks’ Motion For Summary Judgment On Plaintiffs’ Knowing Participation In Breach Of Fiduciary Duty Claim In Stanford Ponzi Scheme Case

In Janine v. McAfee, parties fought over who should be the administrator of an estate. No. 01-20-00717-CV, 2021 Tex. App. LEXIS 10101 (Tex. App.—Houston [1st Dist.] December 23, 2021, no pet. history). A man and woman divorced in 1983 and executed a post-divorce settlement agreement that purported to divide their assets. The man died in 1997, and his sister was his executor. The woman died in 2011, and her daughter became the executor of her estate. The daughter filed suit on behalf of the woman’s estate regarding the ownership of certain assets. The sister of the man was elderly, and her daughter became the successor administrator of his estate. Then the man’s granddaughter intervened in the man’s estate and filed a motion to vacate the appointment of executrix’s daughter as successor administrator and filed a no-evidence motion for summary judgment, alleging that she should be appointed the successor administrator. The trial court denied both motions, and an appeal followed. Continue Reading Appellate Court Held That It Did Not Have Jurisdiction Over A Probate Court’s Order Denying A Motion For Summary Judgment And Motion To Vacate Appointment Of A Successor Administrator

In Clark v. Clark, two brothers sued a third brother regarding the third brother’s ability to be trustee of a trust due to a traumatic brain injury. No. 14-19-00604-CV, 2021 Tex. App. LEXIS 9866 (Tex. App.—Houston [14th Dist.] December 14, 2021, no pet.). The parties’ mother created a testamentary trust that held a family business and named the third brother as the trustee. The will provided that “[i]f for any reason, SCOTT ALEXANDER CLARK, shall fail to qualify or cease to serve, for any reason, as Trustee under my Will, I designate and appoint as successor Co-trustees my sons, STEVEN WAYNE CLARK and ROBERT GEORGE CLARK.” Id. The two brothers alleged that because the third suffered a traumatic brain injury that required brain surgery, intubation, and hospitalization, he had ceased to serve or was unable to serve as trustee of the trust. They sought a preliminary order that declared that “(1) Scott had ceased to serve or was unable to serve as trustee; (2) Steven and Robert are successor co-trustees under the terms of the Will; and (3) Steven and Robert, as successor co-trustees of the Trust, are appointed to manage the assets of the Trust so long as Scott is unable to do so.” Id. The two brothers also sought a temporary restraining order and a temporary injunction prohibiting the company’s employees from interfering with their operation of the business. The trial court granted the order, and the third brother appealed. Continue Reading Court Affirmed Order Granting Injunction To Allow Successor Trustees To Manage A Business Owned By A Trust

In MBM Family Trust No. 1 v. GE Oil & Gas, LLC, a plaintiff filed suit against a defendant and his companies to domesticate a foreign judgment. No. 05-20-01103-CV, 2021 Tex. App. LEXIS 7698 (Tex. App.—Dallas September 17, 2021, no pet.). Later the plaintiff added a trustee of a trust that the plaintiff alleged assisted the defendant in hiding assets. The trustee filed a special appearance and objected to personal jurisdiction. The trial court denied that objection, and the trustee appealed. Continue Reading Texas Court Rejects Trustee’s Objection To Personal Jurisdiction

FORT WORTH, TX – Winstead PC, a leading national law firm, today announced that David Fowler Johnson, Managing Shareholder of the firm’s Fort Worth office and the lead writer for the Texas Fiduciary Litigator blog, was awarded the JDSupra Readers’ Choice Award for Top Author in Wealth Management.

This is the fourth year in a row David has received an award from JDSupra in the Wealth Management field. The annual award recognizes top authors, and firms, who were read by C-suite executives, in-house counsel, media, and other professionals across the JD Supra platform during 2021. Continue reading.

In Wells Fargo, N.A. v. Clower, a trustee filed suit for declaratory relief regarding its discretion to make income distributions. No. 02-20-00058-CV, 2021 Tex. App. LEXIS 7675 (Tex. App.—Fort Worth September 16, 2021, no pet.). The beneficiaries filed counterclaims for breach of fiduciary duty. The trial court ordered the trustee to pay into the registry of the court over $250,000 for attorney’s fees it had paid out of the trust and ordered the trustee to no longer pay its attorneys from the trust. The beneficiaries challenged the trustee’s standing and capacity as trustee, alleging that the trustee was only a de facto trustee and not a de jure trustee. After a three-day bench trial on the issue of standing, the trial court concluded in 2011 that Wells Fargo had standing as trustee, i.e., was the de jure trustee of the trust. The court noted that the beneficiary had also lost on the standing issue in federal court. Id. (citing Clower v. Wells Fargo Bank, N.A., 2:07-CV-510-TJW-CE, 2011 U.S. Dist. LEXIS 162702, 2011 WL 13196511, at *2 (E.D. Tex. Sept. 30, 2011); Clower v. Wells Fargo Bank, N.A., 259 F.R.D. 253, 254, 261-62 (E.D. Tex. 2009) (order granting class certification), order vacated, appeal dism’d, 381 Fed. Appx. 450 (5th Cir. 2010)). Continue Reading Court Holds That Trust Was Not Ambiguous And Provided The Trustee Discretion In Making Income Distributions

Shareholder David F. Johnson will address the various issues that arise when a trustee enters into a self-interested transaction with the trust. Among other issues, it will address the duty of loyalty, the presumption of unfairness, trustee compensation, non-compensation benefits, exculpatory clauses, consent/release agreements, and procedural issues in litigating self-interested transactions.

Watch On Demand

In McEndree v. Volke, a beneficiary sued a trustee, her former step father, for breaching fiduciary duties. No. 11-19-00351-CV, 2021 Tex. App. LEXIS 7856 (Tex. App.—Eastland September 23, 2021, no pet. history). The trust was to hold Social Security Administration benefits. Though the trust was created in 1997, the beneficiary was not aware of it until 2016 because the trustee never told her about it, never made a distribution, and never provided any accounting information. The beneficiary filed a traditional motion for summary judgment based on deemed admissions and on the affidavit. The trial court granted the motion, and the trustee appealed. The court of appeals reversed, holding that the beneficiary did not meet her summary judgment burden of proof. Continue Reading Court Reversed Summary Judgment Against Trustee Where Beneficiary’s Affidavit Evidence Was Conclusory

In Flores v. Branscomb PC, before her death, the decedent hired counsel to prepare a new will. No. 13-18-00411-CV, 2021 Tex. App. LEXIS 4612 (Tex. App.—Corpus Christi June 10, 2021, no pet. history). The new will would have named the decedent’s granddaughter as her executor and as a beneficiary. The decedent died before signing the new will, and the granddaughter sued the decedent’s attorneys for malpractice. The attorneys filed a motion for summary judgment, arguing that they owed no duty to the granddaughter. The trial court granted the summary judgment, and the granddaughter appealed. Continue Reading Court Held That The Estate Planning Privity Rule Barred Granddaughter’s Claim For Malpractice Against Her Grandmother’s Attorneys Regarding The Failure To Execute A New Will

On Thursday, February 11, Winstead Shareholder David F. Johnson presents his 2020-2021 Fiduciary Litigation Update at the UT Law CLE 18th Annual Changes and Trends Affecting Special Needs Trusts. David’s presentation will cover recent statutory changes and case law updates.

Date: Thursday, February 11, 2022 at 9:30 a.m.
CLE Credit: 0.75 hr
Location: AT&T Conference Center, Austin, Texas – Webcast Available

This event brings together nationally recognized professionals in the SNT field, features the latest updates and hot topics, and offers a great set of materials including sample forms, drafting tips, sample language, and resources. Learn more.

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