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PROBATE 32: Can you file a breach of fiduciary duty complaint for a disagreement related to the estate?

Plaintiff filed this action against defendant, who is the personal representative of the estate of plaintiff’s father.

Plaintiff’s father died on June 17, 2015. Following his death, estate proceedings were initiated in Washtenaw Probate Court, and defendant was appointed by the court as personal representative of the estate.  The only significant asset was a residential property in Ann Arbor, Michigan.

While the estate proceedings were ongoing, in November 2016, plaintiff filed a separate complaint in Washtenaw Circuit Court claiming that she held a mortgage and promissory note on the home; plaintiff sought to foreclose on the property and quiet title in her name. The circuit court property dispute was transferred to the probate court and consolidated with the estate proceedings.

Notably, on August 8, 2017, the judge entered an order concluding that plaintiff had not shown that she was entitled to enforce the note and mortgage that was in her possession, which had been given by her father to his parents. The judge held plaintiff failed to demonstrate she had personally acquired any rights under the note and mortgage. Accordingly, the judge rejected plaintiff’s request to foreclose and to quiet title to the property in her name.

On May 16, 2017, while the consolidated estate and foreclosure proceedings were still pending, plaintiff filed in the probate court a complaint alleging 17 counts against defendant in her capacities as an individual, as personal representative of the estate, and as attorney for the personal representative of the estate.

In an October 26, 2017 order, the trial court granted summary disposition to defendant on all of plaintiff’s claims except for two. The trial court permitted plaintiff’s action to proceed on her claims of breach of contract and unjust enrichment (Counts I and II), and these claims were only allowed to proceed against defendant in her capacity as personal representative. Following a bench trial, the judge entered judgment in favor of defendant, concluding that plaintiff had failed to establish her claims for breach of contract and unjust enrichment.

The common theme of these claims was that plaintiff disagreed with various actions taken by defendant related to the estate and such actions therefore constituted a breach of defendant’s fiduciary duty. Plaintiff cites no authority for the proposition that her mere disagreements with the decisions of defendant as the personal representative establishes that defendant breached her fiduciary duty.

Defendant had a duty to act in the best interests of the estate, MCL 700.3703(1). However, plaintiff argued that defendant’s fiduciary duty was to accede to plaintiff’s precise demands and make decisions about matters involving the estate that were in accordance with the outcomes plaintiff desired. Clearly, this is not the nature of a personal representative’s fiduciary duty.

The claims for breach of fiduciary duty in plaintiff’s first amended complaint contain no allegations, beyond plaintiff’s mere subjective and conclusory assertions of disagreement with defendant’s decisions, as to how any of defendant’s actions were legally improper such that they constituted a breach of fiduciary duty.

Aldrich Legal Services represents clients in a wide range of probate litigation matters.

Given the emotional nature of these disputes and their financial impact on all involved, it is critical that anyone involved in such a dispute retain highly qualified legal counsel.

Contact Aldrich Legal Services

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