The trustee can be the trustee of a trust estblished in a will or trust document.
Violating a duty owed to beneficiaries is a breach of trust.
The Chancery court can order any of the following remedies for breach of trust to beneficiaries.
(1) Compel the trustee to perform the trustee’s duties;
(2) Enjoin the trustee from committing a breach of trust;
(3) Compel the trustee to redress a breach of trust by paying money, restoring property, or other means;
(4) Order a trustee to account;
(5) Appoint a special fiduciary to take possession of the trust property and administer the trust;
(6) Suspend the trustee;
(7) Remove the trustee as provided in Section 91-8-706;
(8) Reduce or deny compensation to the trustee;
(9) Subject to Section 91-8-1012, void an act of the trustee, impose a lien or a constructive trust on trust property, or trace trust property wrongfully disposed of and recover the property or its proceeds; or
(10) Order any other appropriate relief whether provided elsewhere in this chapter, available at common law or under equity principles.
The Chancery court may order the following for beneficiaries caused by the breach of trust by the trustee:
The great of:
1. the amount required to restore the value of the trust perty and trust distributions to what they would have been had the breach not occurred or
2.the profit the trustee made by reason of the breach
OR
Any measure of damages otherwise provided by law.
If there is no breach of trust, a trustee is not liable to a beneficiary for a loss or depreciation in the value of trust property or for not having made a profit.
In a judicial proceeding involving the administration of a trust, the court, as justice and equity may require, may award costs and expenses, including reasonable attorney’s fees, to any party, to be paid by another party or from the trust that is the subject of the controversy.
In a nonjudicial proceeding involving the administration of a trust, the trustee may pay fees, other reasonable costs, and expenses from trust assets where all of the parties to the proceeding agree in writing.
In a mediation or arbitration proceeding involving the administration of a trust, the mediator or arbitrator may award fees, other reasonable costs, and expenses against the assets of the trust.
A trustee who acts in reasonable reliance on the terms of the trust as expressed in the trust instrument is not liable to a beneficiary for a breach of trust to the extent the breach resulted from the reliance.
In general, if the trustee is not, or reasonably should not be aware of facts that would otherwise prohibit the trustee from doing an act, the trustee is not liable for action without such knowledge.
If the trust or will has a provision that provides the trusteee shall not be liable for breach of trust, such provision is not valid if it attempts to (1) Relieves the trustee of liability for breach of trust committed in bad faith or with reckless indifference to the purposes of the trust or the interests of the beneficiaries; or (2) Was inserted as the result of an abuse by the trustee of a fiduciary or confidential relationship to the settlor.
In addition, if beneficiaries consented to the conduct constituting the breach, released the trustee from liability for the breach, or ratified the transaction constituting the breacha a trustee, the trustee is not liable for breach unless, (1) The consent, release, or ratification of the beneficiary was induced by improper conduct of the trustee; or
(2) At the time of the consent, release, or ratification, the beneficiary did not know of the material facts relating to the breach and the trustee had actual knowledge of the facts relating to the alleged breach.
In general, a trustee is not personally liable for a contract and other matters entered into and related to the administration of the trust. Actions relating to same should be brought against the trustee in his or her fiduciary capacity, not in his or her personal capacity and therefore the trust would be liable, not the trustee personally.
