Breach of Fiduciary Duty
Breach of fiduciary duty can occur when a fiduciary such as an Executor, Administrator or Trustee obtains profit through self-dealing or causes losses through a breach of duty. If this happens, you need an experienced New York City estate litigation lawyer who knows how to evaluate and recommend equitable remedies.
Breach of fiduciary duty can take many forms some of which are apparent and others which require examination of fiduciary accounts and transactions in detail. Court proceedings may be necessary to remedy these breaches of duty or to remove a fiduciary from his or her position. Breach of fiduciary duties remedies vary depending upon the situation. It is not always easy to determine whether a fiduciary has breached or acted improperly especially where complex financial and business matters are involved. Sometimes a New York City attorney will obtain the services of a forensic accountant, an appraiser or other specialist to examine the fiduciary's actions.
In circumstances of a breach of fiduciary duty, a court may award one of the following remedies against a defaulting fiduciary: (a) a constructive trust; (b) an account of profits; or (c) equitable compensation or surcharge.
Executors, Administrators and Trustees have many responsibilities and obligations. It may not be easy to determine or to demonstrate to the Court that a fiduciary has breached some duty or obligation. For example, a fiduciary has an obligation not to engage in self-dealing. This means that a fiduciary cannot take advantage of his position to benefit himself at the expense or the detriment of an estate or trust or the beneficiaries. A fiduciary also has the obligation of acting fairly and cannot benefit one beneficiary over another. Also, a fiduciary must act reasonably and responsibly. For example, an Executor is required to gather Estate Assets and determine whether the estate may be subject to estate taxes. If taxes are due, the Executor must arrange for timely payment of the taxes or he may be responsible for any interest and penalties incurred due to his neglect.
One of the more common remedies in cases where a fiduciary, such as an executor or administrator, fails to conduct his affairs properly, is to ask the Court to revoke his appointment and remove him from office. New York Surrogate's Court Procedure Act ("SCPA") Section 711 provides that a person who is interested in the matter may ask the Court for this relief. Some of the grounds for removal provided by the statute include the waste of assets, dishonesty, improper management of property and refusal or neglect by the fiduciary to obey a direction of the Court.
New York City lawyers work closely with their fiduciary clients to assist them with complying with the many rules and requirements that concern their fiduciary role. It is always best to obtain good sound advise from an attorney rather than to engage in conduct without full consideration of the harm and damage that may result to an Estate for which a fiduciary may be found to be personally liable.
I graduated in the top 10% of my class at New England School of Law in Boston and have been representing clients in matters involving fiduciary duties for many years. I provide my clients with personal representation and work with them to obtain the results they desire.
You can contact me at (212) 355-2575 or e-mail for a free appointment with a New York City attorney.