Kritchman v. Wolk
2014 WL 4852057, 2014 Fla. App. LEXIS 15266, 152 So. 3d 628 (2014)
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Rule of Law:
A trustee of a revocable trust is obligated to carry out a settlor's clear, written directive issued during the settlor's lifetime, and this duty to perform is not extinguished by the settlor's subsequent death.
Facts:
- Lola Kritchman established a revocable trust, with Wells Fargo as a co-trustee, that allowed her to direct payments from the trust's principal during her lifetime.
- Pursuant to Mrs. Kritchman's directions, the trust paid for Hunter Wolk's private school tuition for seven years and for his freshman and sophomore years at Yale University.
- On April 17, 2010, Mrs. Kritchman sent a signed letter to her trust officer at Wells Fargo directing the bank to 'make arrangements so that his costs will be paid for those 2 years as well,' referring to Wolk's upcoming junior and senior years.
- Following this directive, Wells Fargo paid for Wolk's tuition for the fall semester of his junior year in September 2010.
- Mrs. Kritchman died on November 8, 2010.
- After her death, her son, William Kritchman, became a co-trustee of the trust alongside Wells Fargo.
- A dispute arose between William Kritchman and Wolk's mother concerning a codicil to Mrs. Kritchman's will.
- Following this dispute, William Kritchman countermanded his mother's prior directive, and Wells Fargo ceased making payments for Wolk's remaining three semesters at Yale.
Procedural Posture:
- Hunter Wolk filed a lawsuit against William Kritchman and Wells Fargo in a Florida trial court.
- Wolk's second amended complaint alleged breach of written and oral contracts, promissory estoppel, and breach of trust for unpaid undergraduate and future graduate school expenses.
- The parties filed cross-motions for partial summary judgment.
- The trial court granted final judgment in favor of Wolk on the breach of oral contract and breach of trust claims, awarding damages for the unpaid Yale expenses and reserving jurisdiction to award future graduate school costs.
- The trial court granted summary judgment for the defendants on the written contract and promissory estoppel claims, finding them duplicative.
- William Kritchman and Wells Fargo, as appellants, appealed the final judgment to the District Court of Appeal of Florida, Third District.
- Hunter Wolk, as appellee, cross-appealed the trial court's adverse ruling on his written contract and promissory estoppel claims.
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Issue:
Does a trustee breach its fiduciary duty by failing to follow a settlor's unambiguous written directive to pay for a beneficiary's educational expenses after the settlor's death, when the directive was given during the settlor's lifetime?
Opinions:
Majority - Salter, J.
Yes, a trustee breaches its fiduciary duty by failing to execute such a directive. The settlor's written letter was an unambiguous directive issued during her lifetime under the express terms of the Trust Agreement. The trustee was obligated to 'make arrangements' to pay for the full two years as instructed, and this obligation was not nullified by the settlor's death. The trustee's partial performance (paying for the first semester) confirms their understanding of the directive. The subsequent failure to pay was not based on any ambiguity in the trust or the directive, but rather on a separate dispute between the new co-trustee and the beneficiary's family, which is not a legally justifiable reason for inaction. This failure constituted a breach of the trustee's statutory duties to administer the trust in good faith, act impartially, and prudently administer the trust.
Analysis:
This decision reinforces the legal principle that a settlor's clear, written intent is paramount in trust administration. It establishes that a lifetime directive to a trustee of a revocable trust creates an obligation that survives the settlor's death, preventing successor trustees from unilaterally revoking such instructions based on extrinsic disputes. The ruling clarifies that trustees cannot selectively comply with a directive; once they begin performance, they must complete it as instructed. This case provides a strong precedent for beneficiaries seeking to enforce specific promises made by a settlor through directives that may not have been formally incorporated as amendments into the main trust document.
