The patriarch of a wealthy New Jersey family created and generously funded a dynasty trust, the income of which was to be distributed by the three trustees to charity for several decades and thereafter the income and principal became available to be distributed to the family in amounts and at times to be decided by the trustees. When the charitable period of the trust ended, the trustees asked the Court to enter an order naming the members of the family beneficiary class of the multi-million-dollar trust. The family disputed the right of J, an adult woman, to participate, asserting that she was not the blood child of a family member but rather she was the product of an extramarital affair of a male family member’s wife. Two of the three trustees agreed to withhold trust distributions to J pending the New Jersey Courts’ (trial, Appellate Division and Supreme Court) resolution of the dispute. The third trustee, H, was adamant that J was entitled to distribution from the trust, notwithstanding the question about her paternity. During discovery (review of thousands of documents, interrogatories, and depositions) it was revealed that trustee H had secretly loaned J large sums of money and was in covert communications with J’s lawyer about the trust case. Numerous family members sued to remove trustee H from his position on the grounds of breach of fiduciary duty, including bias, favoritism, and violations of the duty of loyalty to all of the beneficiaries and the trust. After fighting to keep his position, and not receiving the support of the other two trustees, trustee H agreed to resign from the trust.
Verdicts & Settlements