Reproduced with permission from the October 11, 2017 issue of NEW YORK LAW JOURNAL © 2017 ALM Media Properties, LLC. All rights reserved. Any further reproduction without permission is prohibited. For more information, call 877-257-3382 or reprints@alm.com. #070-10-17-09 Receipts and waivers were used both as a shield and as a sword in probate proceedings when trustees were confronted with claims that had already been resolved, or at least allegedly. Although it is instinctively assumed that a publication is an absolute obstacle to the continuation of a dispute, the actual circumstances of obtaining release, as well as the conditions of the publication itself, often determine the outcome. Ilene Sherwyn Cooper is a partner at Farrell Fritz in Uniondale, where she focuses on trusts and estates. She is the past Chair of the Trust and Estate Law Section of the New York State Bar Association. It was created by attorney Aaron Hall (aaronhall.com) solely for educational purposes. This information may not be appropriate for your situation or jurisdiction. This may be outdated, outdated, or otherwise inaccurate. YOU SHOULD CONSULT A LAWYER BEFORE RELYING ON THE INFORMATION HERE.
First, this rule does not apply to voluntary compensation or the performance of liability. In other words, the trustee can ask you to sign a release, and you can voluntarily agree to do so. The release is valid as long as the trustee does not threaten to withhold your escrow distribution until you have signed the release. Surrogate`s Court, New York County,`s statement in In re Bronner, NYLJ, January 21, 2016, at p. 32, is revealing. == External links == three contested mandatory accounting proceedings in progress, in which the defendant/trustee objected to legal protection on the grounds that the applicant/beneficiary had previously executed receipts and exemptions releasing him from liability. The applicant sought a summary verdict, stating in part that the releases had not been obtained fairly from her due to an allegedly inadequate disclosure and explanation of the transaction by the trustee. Recently, the Surrogate Court and the Appeal Division had the opportunity to provide additional guidance on the impact of receipts and authorizations through the decisions in In re Salz, NYLJ, July 27, 2017, p. 22 (Surrogate`s Court, New York County), and Matter of Lee, 2017 NY Slip Op 06276 (2d Dep`t 2017). While it`s true that a trustee can`t force you to sign a waiver, a release may be the cheapest alternative to administering a trust. Just do us a favor.
Do not sign anything until you have a complete understanding of all the steps your trustee has taken when acting as a trustee. The undersigned releases and releases [JOSHUA FRY SPEED], as successor trustee of the Trust, from and from all claims for dividend shares and from all acts, claims and demands arising out of or arising out of or arising out of any other act, matter, reason or matter arising out of the aforementioned Trust, the Estate or its administration, as well as its representatives, lawyers, accountants and/or other representatives. I understand that I have the right to seek the advice of independent counsel, but I am waiving that right at this time. In Salz, the Substitute Tribunal concluded that the terms of a receipt, release and compensation agreement signed by the applicant excluded her claims for investigation and turnover under SCPA 2103. The proceedings had been initiated against the surviving spouse of the deceased by one of the deceased`s sons from a previous marriage, who was favoured according to his will. In particular, his wife, who was his curator, was the subject of controversial accounting proceedings before the death of the deceased, during which the applicant and his brother had questioned the correctness of his administration. In one relevant part, they claimed that the deceased`s spouse did not take into account all of their father`s works of art. This dispute continued several years after the death of the deceased, at which time it was settled in accordance with the terms of an “agreement on settlement and recruitment”, which provided, inter alia, that the wife of the deceased “individually and in her capacity as custodian and in any other capacity. of all the debts they have had now or never” against payment of a certain amount.
About four years later, the plaintiffs commenced proceedings to hold BNY and Merrill Lynch accountable for each of the trusts. The respondents` applications to dismiss were allowed and the applicants appealed. Significantly, the Appeal Division found that the Substitute Court should not have dismissed the motions against BNY on the ground that the claims invoked were excluded by the releases, since BNY did not assert that all applicants who were not represented by counsel at the time the documents were signed were fully aware of the nature and legal effect of the releases at that time. Nevertheless, the tribunal found that the Substitute Court correctly held that the claims against BNY for accounting were time-barred, as the accounting claims arose when Merrill Lynch succeeded BNY as trustee in 2001 and 2002. In addition, the tribunal found that the surrogate court had correctly concluded that the claims against BNY were not covered by the fraud and that the principle of fair estoppel was not applicable. The fifth exception can be a bit hard for many beneficiaries to believe. And I`m not sure there`s a good explanation for that. For one, if you have a large escrow portfolio, the cost of court-approved accounting is likely to be small compared to the amount of your escrow distribution. If accounting costs $20,000 (between accounting fees, attorneys` fees, and other court fees) and your escrow distribution is $1 million, then court-approved accounting may not be that bad. However, if your fiduciary distribution is $100,000, court-approved accounting becomes a larger expense. In dismissing the application and ordering a hearing, the court warned trustees who were attempting to avail themselves of the protection afforded by a release, noting that since a transaction between a trustee requesting the release of a beneficiary is essentially independent, the law requires that it provide full disclosure of the facts of the situation and the beneficiary`s legal rights by the beneficiary.
Trustee. as well as appropriate consideration. In addition, the court concluded that the mere absence of misrepresentation, fraud or undue influence in obtaining release does not protect the instrument from subsequent attacks by beneficiaries. Rather, the trustee must prove in the affirmative that the beneficiaries have been informed in full detail of the nature and legal effect of the transaction. In that context, on the basis of the applicant`s allegations and the absence of documents to the contrary, the Court held that the applicant had argued prima facie that the authorisations in question had not been obtained equitably and therefore did not necessarily exclude her right to accounts. In an attempt to oppose a summary decision, the trustee stated that, although no informal account was provided to the Claimant at the time the releases were made, her husband and a trusted friend who was the asset manager of the real estate interests held by the trusts provided her with appropriate and complete disclosure. (Notably, the beneficiary was not represented by a lawyer at the time she signed the authorizations.) In addition, the written evidence provided by the trustee indicated that the applicant was familiar with the assets of the trust and the transactions underlying the rejections. In addition, I hereby acknowledge and agree that once the Trustee has received a signed waiver of final accounting and approval of the distribution of each beneficiary of the Trust, I will receive [seventeen thousand five hundred dollars] ($17,500) as a distribution interest in the Trust and Estate, except for my share of the cash reserve, where applicable. This distribution represents complete and complete satisfaction of my trust and estate interests.
I understand that I could keep my legacy in sumptuous and grieving confidence. I chose not to. A year later, the co-executors of the deceased`s estate, which included the deceased`s spouse, entrusted their administration to the beneficiaries of the estate and the trustee of the trust created under the deceased`s will. In this context, the claimant and his brother signed a reception and release agreement stipulating that they had verified the account of the executors, found it complete and that they “released the executors of wills individually and as executors of all claims and causes of action, liabilities and obligations and released them forever …”. You may be wondering how a release is useful? A release offers the trustee a significant advantage. A release provides protection to the trustee in a scenario where the beneficiary later decides to sue the trustee. The trustee can use the waiver to prove that the beneficiary has released him from any legal claim that the beneficiary may later assert. It`s the language that makes it happen: I`m Aaron Hall. .