Also known as: abuses of trust · breach of trust
Written by attorneys · grounded in primary & secondary sources — see below
A misuse of a position of trust or fiduciary relationship by a person in a position of authority or confidence to facilitate wrongdoing or breach duties owed to another.
Anthony Arnold serves as trustee for a family trust. He sells trust property to his own company at an inflated price without informing beneficiaries. When beneficiaries later discover the transaction and attempt to release him from liability, the court finds the release invalid because Anthony induced it through abuse of his fiduciary position.
Audrey Ashton acts as trustee under a will granting a power of appointment. She transfers trust assets directly to an impermissible appointee named in the donee's will. The transfer constitutes a breach because Audrey failed to verify compliance with the power's scope and thereby abused her fiduciary role.
Select any source to read its text and confirm it supports the definition.
Albert Allen, trustee of a charitable trust, diverts funds to personal ventures. Beneficiaries petition the court. The court issues an injunction preventing further misuse, recognizing that Albert's conduct amounts to an abuse of the trust placed in him by the settlor.
Angela Acosta serves as fiduciary and transfers assets to a permissible appointee under a power of appointment. She has no reason to know the appointment exceeds the donee's authority. The transfer does not constitute a breach because Angela did not abuse her position by knowingly facilitating an improper appointment.
Anika Anand becomes successor trustee and learns the prior trustee misappropriated funds. She takes reasonable steps to compel return of the assets and to redress the prior breach, thereby preventing the former trustee's abuse of trust from going unremedied.
Amber Alonzo, trustee, repeatedly diverts trust income to her personal accounts. Beneficiaries petition for removal. The court removes her because her conduct amounts to a serious breach arising from abuse of the fiduciary relationship.
A beneficiary's consent, release, or ratification does not shield a trustee from liability when the trustee induced the consent through improper conduct amounting to abuse of a fiduciary or confidential relationship.
Supporting sources
A fiduciary commits a breach by transferring property to an impermissible appointee. The fiduciary must exercise reasonable diligence to confirm the appointment complies with the power's terms.
Supporting sources
A court may enjoin the trustee from committing further breaches, compel performance of duties, order monetary redress, or remove the trustee when the conduct constitutes a serious breach arising from abuse of the fiduciary position.
Supporting sources
A successor trustee must take reasonable steps to compel delivery of trust property and to redress any known breach committed by a former trustee.
Supporting sources