Full Disclosure: The Unexpected Ambits and Annals of the Adequate Disclosure Doctrine
Florida, like other Uniform Trust Code states, has made a clear public-policy determination in favor of transparency in the administration of trusts. From inception, trustees must notify and regularly report to current and future beneficiaries. Those extensive duties to beneficiaries are balanced by somewhat less expansive protections for the trustees that perform them. One such protection, the statute of limitations for breach of trust claims is, in fact, directly tied to the trustee reporting obligations.
The limitations period, which ranges in Florida from four years to six months, however, applies only to those matters that are “adequately disclosed” to trust beneficiaries in a trust disclosure document.1 While the statute includes a somewhat vague definition of the term, there is very little caselaw to guide a trustee in determining whether matters reported in its trust statements are “adequately disclosed” to beneficiaries. Recently, a Florida appellate court adopted a surprisingly narrow interpretation of “adequate disclosure” in a case of first impression that could exercise outsized influence with courts in Florida and beyond.
Florida Trustee Limitation Periods
Claims of breach by beneficiaries against trustees are time-barred in just a few, limited circumstances, which are enumerated by statute.2 That statute (limitations statute) is structured into three distinct prongs along with a separate statute of repose:
1)Standard Limitations Period: A four-year limitations period3 applies if the trustee has “adequately disclosed” a matter in a “trust disclosure document” or, absent adequate disclosure of that particular matter, if the trustee has provided the beneficiary with a) a final accounting and b) a statutory notice.4 The standard limitations period runs on the beneficiary’s receipt of the trust disclosure document in the former instance or the beneficiary’s receipt of the final accounting and statutory notice in the latter instance.5
2) Abbreviated Limitations Period: A six-month limitations period applies if the trustee has “adequately disclosed” a matter in a “trust disclosure document” and provided a statutorily prescribed notice of the application of the abbreviated limitations period.6 The abbreviated limitations period runs on the beneficiary’s receipt of the later of the trust disclosure document or the statutory notice.7
3) Extended Limitations Period: A four-year limitations period8 applies if the trustee has not provided the accounting and notice required for application of the standard limitations period. Unlike the standard limitations provision, the extended limitations period is tolled, however, until the trustee can establish the beneficiary had “actual knowledge” of the facts underlying the claim under a clear and convincing evidentiary standard.9
4) Statute of Repose: A somewhat awkwardly structured, multi-part statute of repose applies to all beneficiary claims, regardless of the disclosures provided by the trustee. So long as the beneficiary had knowledge of a) the existence of the trust, and b) their status as a beneficiary, claims by the beneficiary against the trustee are barred upon the later of: 1) 10 years after the date the trust terminates or the trustee resigns, or 2) 20 years after the date of the act or omission at issue.10 A true “statute of repose” applies beginning 40 years after the termination of the trust or the resignation of the trustee.11 Those time periods can be extended by 30 years, however, if a beneficiary can prove that the trustee “actively concealed” relevant facts by a clear and convincing evidentiary standard.
The limitations statute draws from a similarly worded — but not nearly as complex — provision of the Uniform Trust Code (UTC) §1005. The UTC provides for a one-year limitations period if the trustee provided the beneficiary with a “report” that “adequately disclosed the existence of a potential claim for breach of trust” along with notice of the applicable limitations period.12 The statute of repose in the UTC is only five years and begins on the earlier of 1) the removal, resignation, or death of the trustee; 2) the termination of the beneficiary’s interest in the trust; or 3) the termination of the trust.13
The various limitations periods can be thought of as comprising a number of distinct elements, each of which presents a unique evidentiary burden of proof. Under the limitations statute, a “trust disclosure document” is broadly defined as a formal trust accounting14 or “any written report of the trustee.”15 A beneficiary’s receipt of a trust disclosure document can be proved with relative ease using either certified mail or electronic delivery. The contents of the statutory notices required under the limitations statute are clearly set out in the provisions of the statute and can be easily incorporated into the relevant disclosure documents. For Florida trustees looking prospectively to limit their liability, then, the key is whether matters have been “adequately disclosed” within the meaning of the limitations statute. The question of adequate disclosure was examined for the first time in Florida in a recent case out of the Third District Court of Appeal.
Turkish v. Brody
Turkish v. Brody, 221 So. 3d 1206 (Fla. 3d DCA 2016), involved the estate and trusts of Ada Turkish Trask. The primary subject of the litigation was the Ada Turkish Trask 2005 Trust Number One (the trust).16 Ms. Trask was survived by her son, Arthur, her daughter, Carol, another unnamed child, and Arthur’s daughter, Shari. Arthur and Shari were co-trustees of the trust, while Arthur and Carole were the current beneficiaries.17 The co-trustees had “absolute discretion” to make distributions from the trust principal to the beneficiaries during Ms. Trask’s lifetime “in equal or unequal amounts and to either one of them to the exclusion of the other.”18
The year after Ms. Trask funded the trust, she voluntarily disclosed to the Internal Revenue Service (IRS) that she owed more than $3 million in outstanding gift taxes.19 Subsequently, Ms. Trask and the IRS settled for $1,022,500, which was paid using funds distributed to Arthur from the trust.20 In exchange, Ms. Trask executed an unsecured promissory note in the same amount to Arthur (the note).21
In July 2008, Carole objected to the distribution, alleging that it improperly favored Arthur over her.22 A little over a year later, Carole and the co-trustees entered into a settlement agreement (which the court found “accurately reflect[ed] the [contested] transaction and Carole’s objections” thereto) under which Arthur was to contribute the note to the trust in exchange for a full release of himself and his co-trustee. Carole received a number of trust accountings throughout this period. In August 2009, she received an accounting covering 2005 through 2007, which included the appropriate statutory six-month limitations notice.23 In July 2010, Carole received a trust accounting for 2008, which also included the appropriate statutory six-month limitations notice. Finally, in October 2011, Carole received a trust accounting covering 2009 and part of 2010. 24
In April 2011, Carole filed a breach of fiduciary duty claim against Arthur and Shari and, inter alia, contested the distribution of $1,022,500 to Arthur for the IRS liability payment.25 In response, the trustees argued that Carole’s claims were barred by the settlement agreement or, alternatively, the limitations statute.26 The trial court determined that prior to the execution of the release agreement, Arthur failed to disclose to Carole that Ms. Trask had very little money of her own and that her condominium was owned by an irrevocable trust created in 1980.27 The trial court concluded that Arthur’s failure to disclose these facts to Carole was a conflict of interest due to his role as co-trustee and that the settlement agreement was, therefore, ineffective.28
The Third District, on review, found that the settlement agreement was not effective under New York law because the co-trustees did not make “full disclosure” (a legal standard distinct from “adequate disclosure”) to Carole, although that legal conclusion was vigorously disputed by Judge Shepherd in his dissent. 29 The court concluded that, under the circumstances, the required “full disclosure” was that the note was “virtually worthless” because of Ms. Trask’s lack of assets. 30
In analyzing whether Carole’s claims were barred by “adequate disclosure” of the 2008 trust accounting (which disclosed the contribution of the note to the trust), the court found that the same facts would need to have been reported to “adequately disclose” the transaction; that is Arthur would have had to disclose that the note was “virtually worthless.” The court offered no reasoning for its conclusion that the second prong of the adequate disclosure inquiry — whether the report provided sufficient information so that the beneficiary reasonably should have inquired into the existence of a claim — was not met. 31
Under the limitations statute, a matter is “adequately disclosed” in a trust disclosure document if the “document provides sufficient information so that a beneficiary” either “knows of a claim” or “reasonably should have inquired into the existence of a claim with respect to that matter.”32 Thus, conceptually there are two prongs in adequate disclosure analysis, which each must be evaluated in succession as to any given matter: first, whether the trust disclosure document communicates information sufficient for a beneficiary to recognize the existence of a potential claim arising from the matter (the disclosure prong); second, whether the trust disclosure document communicates information sufficient to induce a reasonable beneficiary to inquire into the existence of a potential claim arising from the matter (the inquiry prong). The Turkish court took an unexpectedly narrow view on “adequate disclosure,” finding first that reporting the existence of the contested transaction was not enough to meet the disclosure prong and then holding — without analysis or comment — that the inquiry prong also was not met by that report.
That first holding is significant because the court acknowledged that the contested transaction was disclosed, but insisted that the disclosure prong would only have been met if the accountings had somehow communicated the legal conclusion later reached by the court that the promissory note was “virtually worthless.” This was so, the court reasoned, because the claim arose from an alleged breach by the trustee in using the “virtually worthless” note to resolve the beneficiary’s prior objections to the transaction. The distinction, while subtle, is important: The breach wasn’t holding the asset, it was using the asset to relieve the trustees of liability. The claim in Turkish was not really a breach of the trustees’ duty to prudently invest trust assets, but rather a breach of the trustee’s duty to administer the trust for the benefit of the beneficiaries and not for himself — in other words, the trustee’s apparent self-dealing was not communicated by a document that listed the promissory note at face value.
Curiously, the court appeared to equate the disclosure prong to the “full disclosure” required under New York law (which governed the settlement agreement in their name) when fiduciaries enter into settlement agreements with beneficiaries. In both cases, the court found, the co-trustees should have made the identical factual disclosure that the note was “virtually worthless” due to the finances of Ms. Trask. The court cited no authority for the proposition that those two legal standards were similar or even related. On its face, the disclosure prong appears to be substantially less exacting than the “full disclosure” standard, which apparently requires that the fiduciary disclose not only all “material facts” of which he knows, but also those that he should have known.33 In contrast, the disclosure prong requires only “sufficient” information and, as it relates to the valuation of trust assets, Florida’s Trust Code provides only that accountings must report the value of trust assets “[t]o the extent feasible.”34 That standard appears to conflict with the court’s holding that information about the existence of the note did not meet the disclosure prong because all promissory notes inherently carry the risk of nonpayment.
Although brief, the court’s analysis of the inquiry prong is perhaps even more significant. That holding was just a single sentence in the 24-page opinion: “Further, the [trust accounting] did not provide [the beneficiary] with sufficient information that reasonably should have led her to inquire into her claim against the [c]o-trustees.”35 The lack of analysis is disappointing for practitioners looking for guidance in an area with precious little jurisprudential discourse. More troubling for fiduciaries, though, is that the court reached that conclusion under the facts of this case.
Here, the beneficiary was separately represented by counsel and actively engaged with the trustee as an adversary with respect to the very matter at issue on appeal. She freely entered into the settlement agreement that gave rise to the contested promissory note. The underlying circumstances — that is, the necessity of the funds to pay a settlement with the IRS — would put any reasonable person on notice that, at a minimum, the mother lacked liquid assets to make payment on the note. The trustee made no affirmative representations as to the mother’s solvency. Title to the condominium was nothing more than a red herring: The promissory note was not secured by the property (nor did it purport to be) and had the condominium been owned outright by the mother, it would have been protected homestead not subject to the claims of creditors — including the trust. That holding then leads to an important question: Can a trustee ever rely on the inquiry prong in reporting trust operations to beneficiaries in accountings and other trust disclosure documents?
Potential Pitfalls with Adequate Disclosure
Context is important. Turkish could be an outlier resulting from an unsympathetic defendant, but it might also indicate a trend. For fiduciaries concerned about the impact of Turkish, the case raises a number of issues from fiduciary liability, to trust administrative practices, to the privacy rights of beneficiaries. In contrast, Turkish appears to roll back the beneficiary’s statutory responsibility to inquire into trust administration. The practical effect of these changes may alter trust administration in Florida in unintended ways.
F.S. §736.0813 outlines the trustee’s duty to inform and account to the beneficiaries. The statute does not — at least on its face — impose exhaustive reporting obligations. For example, it does not require the trustee to detail the financial stability of the assets and liabilities, the status of the markets in which trust assets are invested, or whether a note payee is solvent. Instead, the trust code simply requires that the trustee provide beneficiaries with an accounting that includes all “significant” transactions during the reporting period and a schedule of the assets on hand at the end of the period, including values.36 In fact, the obligation of “adequate disclosure” is limited by the requirement that the accounting be a “reasonably understandable report.”37 After the Turkish case, however, a trustee must now consider exactly how much to disclose in its trust disclosure document.
Consider a trust that owns a concentrated position in a publicly traded stock that was contributed by the settlor who was an executive at the company; the stock represents a majority of the trust portfolio. Assume the trust was poorly drafted and failed to waive the duty to diversify, but the trustee effectuated the wishes of the settlor to keep the investment. The company’s stock has fallen by a third over the past five years due to fundamental market changes that were not disclosed on a trust disclosure document (though the decline in the value of the stock was disclosed). Would the valuation, coupled with the statutory language, be enough to trigger the abbreviated limitations period? Under the narrow interpretation of Turkish, it may not be — the trustee’s breach was not so much his failure to diversify (which likely was disclosed) as it was his failure over a five-year period to recognize the market conditions and reinvest the portfolio accordingly.
Likewise, consider a trust’s interest in a closely held asset that is valued at $1 million. For five years, the trustee takes fees based on that valuation while actively marketing the interest until it is finally sold for $500,000. Each year, the trustee reports the asset on the accounting using the initial valuation and reports its fees based on that value. While the trustee’s attempts to market the difficult-to-sell interest would make it difficult for a beneficiary to bring a claim for the decline in value, could a beneficiary instead sue the trustee for breach based on excessive fees even though the amount of those fees was disclosed each year? Under Turkish, such a claim might not be barred by the limitations statute because the closely held interest was not reappraised each year and, thus, the proper value for the fee calculation was not actually disclosed to the beneficiary.
Finally, consider a trustee that makes distributions for the benefit of the sole lifetime beneficiary of an irrevocable trust based on an ascertainable standard. The beneficiary is steadily declining in health and utilizing trust assets to pay for medical expenses, including in-home health care. The account statements disclose only the amount of the distributions to the in-home health-care provider, but not the services rendered. After five years, would the remainder beneficiaries be barred by the limitations statute from bringing a claim based on those distributions? Under Turkish, the limitations statute would not likely bar a claim for breach because the basis for such a claim arises not just from the amount distributed but from the purpose of the distribution, which was not disclosed. If that is so, the trustee is placed in the impossible position of failing to fully disclose distributions or violating state and federal confidentiality laws by making a full disclosure.
Ultimately, the impact of the Turkish decision is largely procedural in that it will be quite difficult for fiduciaries to prevail on motions for summary judgement based on the limitation statute. The question of adequate disclosure becomes more factual than legal, leading to less certainty, and more litigation. As demonstrated above, trustees will be incentivized to over disclose, and beneficiaries will bear the burden of that additional cost. More to the point, trustee reports may become less useful to beneficiaries as they grow in volume and detail. In order to shift the needle back toward the core policy goal of transparency, it seems appropriate for courts to place more of an emphasis on the beneficiary’s responsibility to keep reasonably informed of their interest in the trust and to make appropriate inquiries into the administration. A few of our sister states have recently taken this approach and placed the burden on the beneficiary to exercise due diligence as a beneficiary.
Known Unknowns: Actual and Constructive Knowledge in Fiduciary Disputes
Turkish turned on disclosure: that is, what the trustee actually told the beneficiaries in accountings and other disclosure documents about the administration of the trust. The most vexing aspect of that case for fiduciaries, though, is the implied holding that a beneficiary knows nothing about the trust unless he or she is told about it by the trustee. At its most basic, the undisputed facts in Turkish established that a separately represented beneficiary knew of — and even requested — the contribution of an unsecured promissory note to a trust by the trustee; the beneficiary also knew that the promissory note was owed by her mother, a Florida resident, who did not otherwise possess the financial wherewithal to make a payment of the same amount to an infamously relentless (and unfailingly favored) creditor. Such a beneficiary, the court effectively found, need not even go to the county property appraiser’s website to confirm her apparent belief as to the title to her mother’s condominium. Thus, in applying the inquiry prong, the Turkish court ignored the beneficiary’s actual knowledge of the note, including the circumstances of its creation, the inability of the borrower to pay a tax bill, and the fact that it was unsecured. Also ignored was the beneficiary’s constructive knowledge of title to her mother’s residence by way of the public records — a fact that was repeatedly referenced by the court but ultimately, as discussed above, was nothing more than a red herring. Taken in this light, Turkish can be seen as an endorsement of willful ignorance by beneficiaries. This approach is not supported by the Uniform Trust Code and has been roundly rejected by other states faced with the same question.
After a Tennessee court’s strained interpretation of the state’s disclosure statute, the legislature acted to clarify the statute’s broad purpose and scope. Like Florida, Tennessee trustees can shorten the statute of limitations by providing adequate disclosure in a trust report.38 The Tennessee statutes are broader in that their reports do not have to include the limitation notice to trigger the shortened statute, but narrower in that the shortened period is one year. The Tennessee statute on trust accountings and adequate disclosure states: “A report adequately discloses facts indicating the existence of a potential claim for breach of trust if it provides sufficient information so that the beneficiary or the beneficiary’s representative knows of the potential claim or has sufficient information to be presumed to know of it, or to be put on notice to inquire into its existence.”39 The statute is similar to Florida’s but drops the “reasonableness” requirement and adds presumptive knowledge — which is undefined — to the beneficiary’s actual knowledge.
In Meyers v. First Tennessee Bank, N.A., 503 S.W. 3d 365 (Tenn. Ct. App. 2016), the beneficiaries filed a complaint against the trustee, seeking damages for breach of trust related to the mismanagement of trust real estate.40 The trustee claimed that the suit was not timely filed pursuant to Tenn. Code Ann. §35-15-1005 and barred by the one-year statute of limitations.41 The trustee argued alternatively that either 1) the beneficiary’s “actual knowledge” of a potential claim triggered the running of the one-year statute; or, if not, 2) it had adequately disclosed facts in numerous reports to the beneficiaries that would also trigger the one-year statute.42
The appellate court disagreed, finding that “the beneficiary’s knowledge of the potential claim is only relevant to trigger the one-year period if that knowledge was acquired through a report, with the required disclosures, sent to the beneficiary.”43 The court then reviewed the communications provided by the trustee to the beneficiaries regarding the contested assets. The trustee argued that it was regularly communicating with the beneficiaries through phone calls, faxes, letters, and meetings between the parties.44 Those communications, the court found, did not constitute “reports” for purposes of the limitations statute because they were initiated by the beneficiary (not the trustee) and, in any event, the communications did not “adequately disclose” the potential claims because they did not provide the beneficiaries with the information necessary to protect their interests.45
The nuanced holding in Meyers led to a change in Tennessee law. As of July 1, 2017, Tenn. Code Ann. §35-15-1005 was amended to provide (changes in italics):
“(a) A beneficiary, trustee, trust advisor, or trust protector shall not commence a proceeding against a trustee, former trustee, trust advisor, or trust protector for breach of trust more than one (1) year after the earlier of:
“(1) The date the beneficiary, trustee, trust advisor, or trust protector or a representative of the beneficiary, trustee, trust advisor, or trust protector was sent information that adequately disclosed facts indicating the existence of a potential claim for breach of trust; or
“(2) The date the beneficiary, trustee, trust advisor, or trust protector or a representative of the beneficiary, trustee, trust advisor, or trust protector possessed actual knowledge of facts indicating the existence of a potential claim for breach of trust.
“(b) For purposes of this section, facts indicate the existence of a potential claim for breach of trust if the facts provide sufficient information to enable the beneficiary; trustee; trust advisor; trust protector; or the representative of the beneficiary, trustee, trust advisor, or trust protector to have actual knowledge of the potential claim, or have sufficient information to be presumed to know of the potential claim or to know that an additional inquiry is necessary to determine whether there is a potential claim.”
The revised statute strikes a balance between the overarching policy of deliberate transparency and the plain inequity that results from laws that permit — and even encourage — willful ignorance by beneficiaries. Tennessee has decided that a beneficiary’s actual knowledge of a potential claim for breach of trust — however acquired — should be enough to trigger its abbreviated limitations period. While a trustee’s duty to keep the beneficiaries informed remains unabridged, beneficiaries are effectively charged with the responsibility to timely act on what they learn.
Likewise, a recent case in Ohio addressed the beneficiary’s knowledge of the rapid decline of a closely held business. In Zook v. JP Morgan Chase Bank, Nat’l Ass’n, 2017 WL 933221 (Ohio Ct. App. 2017), a closely held business declined in value from seven figures to three over the course of six years under the stewardship of the surviving spouse, as trustee. 46 After the death of the surviving spouse, the successor trustee, Chase, sent a letter to each beneficiary providing a receipt, release, and refunding agreement so that the trustee could close the trust and distribute the remaining assets.47 Each of the beneficiaries eventually signed the release and Chase distributed the remaining trust assets.48
Three years later, the beneficiaries filed a complaint against Chase for breach of fiduciary duties and negligence and included a claim for an accounting and audit in relation to the decline in value of the trust corpus.49 The trial court granted Chase’s motion for summary judgment noting the claims were barred by the signed release.50 The appellate court agreed and looked to Ohio’s statutes on releases and disclosures.51 Like F.S. §736.1011, the relevant Ohio statute, Ohio Revised Code §5808.17(c)(2016), provides that a release is valid unless it “was induced by improper conduct of the trustee,” the beneficiary “did not know of the beneficiary’s rights,” or the beneficiary “did not know of the material facts relating to the breach” when the beneficiary signed the release.52
The appellate court reviewed the trial court’s record and whether the beneficiaries had knowledge of the material facts relating to the alleged breach of fiduciary duties.53 The court explained that constructive knowledge could be imputed from the matters available in the public record.54 “Charging beneficiaries with knowledge of publicly available information or information obtained through minimum investigation prevents them from ‘bury[ing] their head in the sand’ with matters affecting an inheritance or expectancy.”55 Most relevant for the appellate court was the clear indicators for the beneficiaries present at the time they signed their releases: the failure of the closely held business was public (and, certainly, known within the family), and the beneficiaries had all received multiple periodic trust statements after the surviving spouse’s death that disclosed that the company was no longer an asset of the trust.56 Thus, the appellate court agreed with the trial court that the evidence established constructive knowledge on the part of the beneficiaries.57
Conclusion and Impact on Statute of Limitations
The Turkish case addresses what constitutes “adequate disclosure” for a trust document but also raises serious questions about the nature and extent of the “disclosure” required to begin the statute of limitations under F.S. §736.1008. The utility of the disclosure prong is significantly hampered under the decision, which appeared to conflate the “adequate disclosure” standard of the statute with the “full disclosure” requirement imposed by unrelated New York law. As a practical matter, Turkish may have the effect of converting the limitations statute from a legal defense that can be effectively asserted in a motion to dismiss or motion for summary judgment, into an affirmative defense that requires determination of ultimate fact at trial. That interpretation will undermine the underlying policy of deliberate transparency by encouraging trustees to replace concise (and reasonably understandable) reports with unwieldy tomes that over disclose.
Meanwhile, the inquiry prong may be effectively worthless to trustees if courts follow the standard implicitly set forth in Turkish. As discussed above, the beneficiary in Turkish was separately represented, induced the contribution of the contested note, understood the terms of the note including that it was unsecured, knew that the loan was needed so that her mother could afford to pay taxes, and had easy access (via the public records) to determine title to the condominium in which her mother lived. What else would be required to lead a reasonable beneficiary to inquire into a potential claim relating to the value of an unsecured note that was owned by an individual who was unable to pay back taxes? While Turkish did not provide any meaningful insight into its analysis of the inquiry prong, its silence may have created a high bar indeed.
1 Fla. Stat. §736.1008 (2017).
3 Generally, the applicable limitations period for breach of trust actions under Ch. 95 is four years. See Fla. Stat. §95.11(3)(o) (“An action for assault, battery, false arrest, malicious prosecution, malicious interference, false imprisonment, or any other intentional tort….”) (emphasis added).
4 Fla. Stat. §736.1008(1)(a) and (b) (2017). The statutory notice must include 1) the availability of trust records; and 2) the applicability of the limitations period.
6 Fla. Stat. §736.1008(2) (2017).
8 See note 3.
9 Fla. Stat. §736.1008(3)(a) (2017). Note that if the claim involves the trustee’s repudiation of the trust or adverse possession of trust assets, the trustee need only prove the beneficiary’s actual knowledge by a preponderance of the evidence evidentiary standard. Fla. Stat. §736.1008(3)(b) (2017).
10 Fla. Stat. §736.1008(6)(a)1. (2017).
11 Fla. Stat. §736.1008(6)(a)2. (2017).
12 Unif. Trust Code §1005(a) (2010).
13 Unif. Trust Code §1005(c) (2010).
14 For a description of the formal requirements of a trust accounting in Florida, see Fla. Stat. §736.08135.
15 Fla. Stat. §736.1008(4)(a) (2017).
16 Turkish, 221 So. 3d at 1208.
22 Id. at 1209.
25 Id. at 1210.
27 Id. at 1211.
29 Id at 1214.
32 Fla. Stat. §736.1008(4)(a) (2017). That definition of “adequate disclosure” is quite similar to the one found in the Uniform Trust Code. Unif. Trust Code §1005(b) (providing that a trustee has adequately disclosed a matter if a report “provides sufficient information so that the beneficiary or representative knows of the potential claim” or “should have inquired into its existence”) (2010). Note that the limitations statute deleted the reference to a “representative” of the beneficiary and added the requirement of “reasonableness” to the beneficiary’s obligation of inquiry. The comments to that provision unhelpfully do not elaborate on the meaning of “adequate disclosure.”
33 Turkish, 221 So. 3d at 1214 (citing Matter of Birnbaum, 117 A.D. 2d 409, 416 (N.Y. App. Div. 1986)).
34 Fla. Stat. §736.08135(2)(c) (2017).
35 Turkish, 221 So. 3dat 1215.
36 Fla. Stat. §736.08135 (2017).
38 Tenn. Code Ann. §35-15-1005(a) (2016).
39 Tenn. Code Ann. §35-15-1005(b) (2016).
40 Meyers v. First Tennessee Bank, N.A., 503 S.W. 3d 365, 368 (Tenn. 2016).
41 Id. at 370.
43 Id. at 377 (emphasis added).
44 Id. at 379.
46 Zook, 2017 WL 933221 at *2.
49 Id. at *3.
51 Id. at *5.
53 Id. at *6.
55 Id. at *7.
Patrick J. Duffey is an attorney in Holland & Knight’s Private Wealth Services group in the firm’s Tampa office. He works with families to structure tax-advantaged lifetime transfers with corporate and individual fiduciaries, to administer or litigate complex estates and trusts, and with entrepreneurs to grow their businesses and streamline their representation by the firm. A substantial portion of his practice is dedicated to the representation of several international charities as beneficiaries and coordination of their interests in various estates and trusts across the country. He routinely oversees the preparation of a wide range of domestic and international federal tax filings, including estate, gift, and generation-skipping transfer tax returns, as well as applications for recognition of charitable exemption.
Cady L. Huss is an attorney with Spivey & Fallon, P.A., in Sarasota. Her primary focus is litigation, including will and trust contests, lack of capacity and undue influence claims, fiduciary disputes, and exploitation of the elderly.
This column is submitted on behalf of the Real Property, Probate and Trust Law Section, Andrew M. O’Malley, chair, and Douglas G. Christy and Jeff Goethe, editors.