Harrell v. Badger
Florida District Court of Appeal
171 So. 3d 764 (2015)
- Written by Rose VanHofwegen, JD
Facts
In her will, Rita Wilson created a trust for the benefit of her son, David Wilson. The trust required distribution of income to David and gave the trustee power to invade the principal as necessary for his support. The will also provided that any principal remaining upon David’s death would be distributed to his sisters, Joann Harrell and Barbara Dake (plaintiffs). After disputes arose, David petitioned to replace the trustee with his neighbor, Charles Badger (defendant). With the intention of qualifying David for government benefits, Badger transferred the trust assets under a joinder agreement into a sub-account of a pooled trust called the Florida Foundation for Special Needs Trust (FFSNT), which was administered by an attorney and her husband. The joinder agreement provided that on David’s death, any funds remaining in his sub-account would go into the FFSNT for its other beneficiaries, and omitted Harrell and Dake’s interest as contingent beneficiaries under the original trust. Without court approval or notifying Harrell and Dake, Badger had his realtor wife sell the house that was the main trust asset, paid her a 5-percent commission, and wired the proceeds to the FFSNT. The FFSNT trustees misappropriated the trust assets and went to prison. The next year, Badger filed a motion to terminate the original trust, notifying Harrell and Dake of the sale of the house and transfer into the FFSNT. Harrell and Dake filed a counterpetition for breach based on Badger’s failure to get court approval to use his wife to sell the house, failure to notify them of the sale and decanting the trust assets into the FFSNT, and eliminating their remainder interest. Badger argued that Florida law allowed him to rely on an attorney’s advice. The trial court ruled for Badger, reasoning that the original trust gave him power to invade the corpus for any reason he felt served David’s best interest, approved Badger using his wife as a realtor retroactively, and awarded him some $85,000 in attorney’s fees. Harrell and Dake appealed.
Rule of Law
Issue
Holding and Reasoning (Wallis J.)
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