Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

Sunday, April 23, 2017

Article on Fiduciary Duties in Social Enterprise

Fiduciary socialAndrew S. Gold & Paul B. Miller recently published an Article entitled, Fiduciary Duties in Social Enterprise, Cambridge Handbook of Social Enterprise Law (Forthcoming 2017). Provided below is an abstract of the Article:

This chapter examines theoretical and practical issues relating to fiduciary administration in social enterprise. It argues that social enterprise often calls for fiduciary administration on a hybrid model, combining elements of service-type administration and governance-type administration. Like standard service-type situations, social enterprise calls for administration in the interests of a defined constituency (ordinarily, shareholders). However, hybridity is introduced through the commitment to general public-oriented purposes that distinguish social enterprise from conventional business organizations. We will show that, contrary to common opinion, the fiduciary hybridity found in social enterprise is neither unique nor unworkable. We will briefly discuss other examples of hybrid fiduciary relationships and institutions, and we will explain the value of hybridity and how problems attributed to it are, or may be, resolved.

April 23, 2017 in Articles, Estate Planning - Generally, Professional Responsibility | Permalink | Comments (0)

Aaron Hernandez's Victims' Families Go to War over His Estate

HernandezThe three families of Aaron Hernandez’s victims have pledged not to stop fighting for their share of his millions after the former NFL player committed suicide. Now, questions remain about how much of his money is left and how is death will affect these civil cases. However the cases play out, Hernandez’s four-year-old daughter and long-time girlfriend will surely lose out. In another interesting twist, because Hernandez was due for an appeal at the time of his death, a Massachusetts legal principle customarily requires the convictions of defendants who die before their appeal to be vacated. This principle can make it difficult for related civil suits to succeed. Further, if the conviction is vacated, the New England Patriots must pay Hernandez’s estate $3.5 million, a portion of his bonus that was withheld after his arrest.

See James Wilkinson, Fight for Aaron’s Millions: The Families of Hernandez’s Victims Go to War over His Estate (if There’s Anything Left) as Odin Lloyd’s Mom Says the NFL Star’s Suicide Was ‘Another Form of Justice’, Daily Mail, April 19, 2017.

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.

April 23, 2017 in Current Events, Estate Planning - Generally, Sports | Permalink | Comments (0)

Saturday, April 22, 2017

Why You Should Be Careful Where You Die

Where you dieAlthough the future of the federal estate tax is looking grim, some twenty states still impose their own estate or inheritance tax and some of their exemption rates are well below the current federal rate. More specifically, fourteen states as well as the District of Columbia have their own estate taxes, with the highest rate at 20% in Washington. The exemptions in these states vary from $1 million to a high of $5.49 million. On the other hand, six states have inheritance taxes, which are based on the value of certain inherited assets. There are some states, such as Maryland and New Jersey, that charge both an estate and inheritance tax. A combination of these federal and state taxes can create some fairly sizable tax bills, so you must be careful where you die.

See Bill Bischoff, Here Are the 20 Most Expensive Places in America to Die, Market Watch, April 20, 2017.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.

April 22, 2017 in Estate Planning - Generally, Estate Tax | Permalink | Comments (0)

Article on Singapore Securities & Financial Services Regulation

Financial service regulationHans Tjio recently published an Article entitled, 25. Securities and Financial Services Regulation, 17 Singapore Academy of L. Annual Rev. (2016). Provided below is an abstract of the Article:

This is a survey of all the Singapore cases in the past year in the area of what can broadly be termed capital markets regulation (including those heard by the State Courts, given that financial regulation often creates criminal offences that are first heard there). Following convention, these can largely be further classified into the following categories: markets and exchange regulation; licensing of intermediaries and conduct of business rules; issuer regulation and securities offerings; insider trading and market abuse.

April 22, 2017 in Articles, Estate Planning - Generally | Permalink | Comments (0)

Friday, April 21, 2017

How Can a Community Property Trust Benefit You?

Community property trustOne technique for keeping the value of your estate in the family is a community property trust, which can save clients substantial amounts of money in capital gains taxes. Upon creating a community property trust, the entire value of the property receives a basis step-up when a spouse dies, allowing the surviving spouse to sell the property with reduced or eliminated capital gains taxes. In other words, the capital gains taxes on the property will only be calculated from the appreciated value since the deceased spouse’s death, which will be minimal to zero. This tax-saving strategy is a valuable tool for certain couples, particularly those with low basis assets that wish to hold on to the assets until one spouse dies, but this type of trust should not be used for all client situations.

See What Is Community Property and What Are Community Property Trusts?, Wealth Management, April 18, 2017.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.

April 21, 2017 in Estate Planning - Generally, Trusts | Permalink | Comments (0)

Article on How Equity Finds Expression in the Constructive Trust

Nigeria trustKato Gogo Kingston & Mercy Oke-Chinda recently published an Article entitled, To What Extent Can Equity Find Expression in Constructive Trust Under the Nigerian Legal System?, 58 J.L., Policy & Globalization (2017). Provided below is an abstract of the Article:

The object of this paper is to examine the assertion that, constructive trust is a vital legal mechanism through which the conscience of equity finds expression. When real property is acquired in such circumstances that the legal title holder may not in good conscience keep the beneficial interest, equity makes him a trustee of the property. This treatise does not seek to provide a comprehensive philosophical analysis of constructive trust as a subject-matter however, it sets out to elucidate the landscape, growth and cogency for the imposition of constructive trust as probably a safer means by which the legal and equitable interests of the relevant parties may be protected in real and personal properties. Thus, the paper assessed the degree to which constructive trust as equitable remedy is applicable under the Nigerian legal system. Also, the paper seeks to offer viable suggestions for the improvement of the concept and applicability of constructive trust in contemporary settings.

April 21, 2017 in Articles, Estate Planning - Generally, Trusts | Permalink | Comments (0)

Controversial "Three-Parent Baby" Procedure Takes Off in Mexico

Three baby“Three-parent babies,” a new procedure offered to couples who want to reduce the risk of passing specific genetic diseases to their children, is a term that has drawn much attention from the public recently. The procedure has also been viewed as controversial because the embryo takes eggs from two separate mothers and transfers the nucleus from a mother’s egg to a donor egg that had its nucleus removed, which makes its ban in the United States unsurprising due to the potential spreading of defected mitochondria. Currently, Mexico, where medical professional believe they are on the vanguard of medical research, is one country that offers the procedure, possibly due to its weak regulatory framework.

See Jan-Albert Hootsen, Controversial ‘Three-Parent Baby’ Fertility Technique Takes Off in Mexico City, Fox News, April 18, 2017.

April 21, 2017 in Current Events, Estate Planning - Generally, Technology | Permalink | Comments (0)

Article on Liability from Breach of Duty by a Superannuation Trustee

SuperannuationJoseph Charles Campbell recently published an Article entitled, Some Aspects of the Civil Liability Arising from Breach of Duty by a Superannuation Trustee, Sydney L. Sch. Research Paper No. 17/31 (2017). Provided below is an abstract of the Article:

- Under the general law the drafter of a trust deed has great freedom to decide what equitable duties the trustee will be under, subject only to the irreducible core of obligations of a trustee, and any duties imposed by state legislation that are incapable of being excluded. The drafter of a superannuation trust deed is more limited, because unexcludable statutory covenants in s 52 Superannuation Industry (Supervision) Act 1993 (Cth) (“SIS Act”) provide a minimum set of trustee’s obligations, and s 56(2) SIS Act imposes a further limit on what general law duties can be excluded.

- Section 56 SIS Act gives all superannuation trustees a right of indemnity from the assets of the trust fund even for liabilities that the trustee has incurred in breach of trust. The right of indemnity is the same for all the trustees, even though the circumstances that can sometimes justify such a right of indemnity are not the same for all trustees. An unsatisfactory consequence of the existence of the right of indemnity is that a professional indemnity insurer of the trustee would be entitled to be subrogated to that right of indemnity. Administrative powers of ASIC or APRA might deter a trustee from exercising its right of indemnity, but the criteria on which such administrative action might be taken are not articulated.

- The jurisdiction of the Superannuation Complaints Tribunal can not only result in the Tribunal making orders against a superannuation trustee, but can also give rise to an equitable duty on a trustee.

- There is considerable doubt about whether equity will require a trustee who breaches a trustee’s duty to pay compensation to an individual beneficiary for consequential financial loss, or for personal suffering that arises from the breach of a trustee’s duty. Equity will sometimes impose liability on people who are associated with a trustee’s breach, but only in quite specific types of circumstances.

- In contrast with the situation in equity, when there has been a breach of a statutory covenant section 55 SIS Act enables a trustee, a director of a corporate trustee, and a person involved in a trustee’s breach of a statutory covenant, to be held liable for all the loss or damage that anyone suffers in consequence of that breach. Persons involved in a breach of a statutory covenant will be under a statutory liability under s 55 in circumstances where they would not have had liability under the general law. The damages payable under s 55, by both trustees and persons involved, are compensation for all financial loss and personal suffering caused by the breach. These damages are likely to be larger, in some cases, than any equitable compensation that might be recoverable for the breach.

April 21, 2017 in Articles, Estate Planning - Generally, Trusts | Permalink | Comments (0)

Thursday, April 20, 2017

Prince's Deliverance Will Not Be Released Tomorrow as Estate Gets Restraining Order

DeliverancePrince’s estate has put the brakes on the planned anniversary release of a new album after a court ruled in its favor. A federal judge granted the estate’s request for a restraining order, meaning that “Deliverance” will not be released tomorrow on the anniversary of Prince’s death. The original producer, George Ian Boxill, who put together the extended play, does not have a right to publicly distribute the music, possibly due to a confidentiality agreement signed back in 2006. Boxill was further ordered to turn over all recordings to the estate. The order, however, did not address the millions of unlucky Prince fans who pre-ordered the album.

See Prince Estate Don’t Even Think About Releasing New Music . . . Producer Loses in Court, TMZ, April 19, 2017.

April 20, 2017 in Current Events, Estate Planning - Generally, Music | Permalink | Comments (0)

Reports Claiming that Couple Seeking IVF Treatment Were Twins Is Untrue

TwinsA report that a couple recently went to a Mississippi fertility clinic and got the surprise of their life when the doctor told them that they were fraternal twins was fake news! The original report did not include verifiable details, such as the reporter’s name, the clinic’s name, the identity of the specialist, or the patient’s names. Because the story was quite interesting to read, several subsequent sites reported the story without fact-checking, which further created public acceptance.

See David Mikkelson, Couple Finds Out They Are Biological Twins During IVF Treatment?, Snopes, April 15, 2017. 

April 20, 2017 in Current Events, Estate Planning - Generally | Permalink | Comments (2)