SARASOTA BANK & TRUST COMPANY, AS TRUSTEE UNDER THE AGREEMENT WITH HENRY E. JONES, DATED NOVEMBER 7, 1961, AS AMENDED, APPELLANT,
v.
NORA H. RIETZ, FORMERLY NORA H. JONES, APPELLEE

Fla. 2d DCA | 1974-06-07
No. 73-334
McNULTY and BOARDMAN, JJ., concur.
297 So. 2d 91 Florida District Court of Appeal, Second District (1974) Positive Treatment
Cited by 7 cases

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Synopsis

Sarasota Bank & Trust Company, as trustee of Henry Jones's 1961 trust, appealed a trial court judgment that increased the widow's annual allowance and ordered payment for home improvements. The Florida appellate court affirmed the ruling that the trustee need not consider the widow's remarriage and her new husband's ability to support her, but reversed the arbitrary application of a cost-of-living index to increase her annual payments.


Holding

The trustee did not act improperly in refusing to pay for air conditioning as part of the repair allowance, and the trustee is not required to consider the new husband's financial support in determining invasions of principal. However, the trial court erred in arbitrarily applying a cost-of-living index to increase the widow's allowance without showing the trustee acted improperly or abused its discretion.


Headnotes

[1] A trustee's discretion in exercising a power is not subject to court control unless the trustee abuses that discretion.

[2] A court will not substitute its judgment for that of a trustee acting within the bounds of its discretionary powers.

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Key Quotes

“Where discretion is conferred upon the trustee with respect to the exercise of a power, its exercise is not subject to control by the court, except to prevent an abuse by the trustee of his discretion.”

Establishes the standard that trustee discretion cannot be overridden absent evidence of abuse or improper motive.

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Facts & Procedural History

Henry Jones established a trust in 1961 naming Sarasota Bank as trustee, with his widow as income beneficiary. The trust authorized the trustee to pay…

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Opinion of the Court
MANN, Chief Judge.

MANN, Chief Judge.

Henry Jones established a trust in 1961 naming the appellant bank as trustee. Ap-pellee, Jones’ now remarried widow, is the income beneficiary of the trust. In addition, the trustee

“ . . . may pay such sums from principal as, in the discretion of the trustee, are suitable or desirable to maintain my said wife in the standard of living to which she was accustomed during my lifetime, and to provide for her such luxuries, pleasures and recreation as she should desire. In making such invasion of the principal, the trustee shall not consider any other resources of my wife, or any other source of income.”

In 1967 the bank sought construction of the trust instrument in a proceeding which culminated in an order entered several months after the widow’s remarriage, fixing the amount to which she is annually entitled at $11,880.

In 1972 Mrs. Rietz initiated the present action. She alleges that the bank refused to authorize payment for new heating and air conditioning equipment in her home and to increase generally the amounts paid to her as stipulated in the prior order. The trustee is alleged to have acted arbitrarily. It counterclaimed, asking the court to determine whether it should consider Mr. Rietz’s ability to support his wife in determining whether principal invasions are necessary to maintain Mrs. Rietz’s standard of living. This latter question was dealt with by the trial court by a statement that the trustee is not entitled to relief on its counterclaim. We think no harm ensues from either construction of the court’s order. The direction is specific, and while a trustee might be entitled to construction of ambiguous language we think the counterclaim does not present an issue on which clarification is necessary. Certainly the trustee would not have initiated an action to construe it. Taking the order as a construction of the language to exclude consideration of the support furnished by the beneficiary’s husband, the ruling — if it is that — is correct. See In Re Geier’s Will, Sur.Ct., 1961, 304 Misc.2d 270, 216 N.Y.S.2d 240; In Re Gatehouse’s Will, Sur.Ct., 1933, 149 Misc. 648, 267 N.Y.S. 808. An extensive annotation at 41 A.L,R.3d 255 deals with the question generally, but excludes cases like this one where specific direction is given. We find the record devoid of evidence that the trustee has acted dishonestly, arbitrarily or from an improper motive. Restatement Trusts 2d, § 187 states:

“Where discretion is conferred upon the trustee with respect to the exercise of a power, its exercise is not subject to control by the court, except to prevent an abuse by the trustee of his discretion.”

The position of the trustee is that the $11,880 paid annually to the beneficiary includes $1200 on account of repairs. This sum was to be contrasted with actual expenditures in 1964 of $496.62; in 1965, $737.14; in 1966, $952.19; and in 1967, $1,011.56. Invasion of principal has been necessary to pay $11,880.

The question is not whether the trial judge or the judges on this panel would construe repairs to include the replacement of air conditioning equipment. The question is whether the trustee acted improperly in so construing the instrument, and we find no evidence that it did. The view that the allowance for repairs should, over the years, permit replacement of this equipment is not untenable.

In addition, the court found that the cost of living has risen since July 29, 1968, a conclusion with which there can hardly be disagreement. It does not follow from this, however, that the specific expenditures required to maintain Mrs. Rietz’s standard of living have increased accordingly, or at all. Some minor expenditures seem in fact to have declined. The arbitrary application of a U.S. Department of Labor consumer cost-of-living index to determine the obligation of a trustee vested with broad discretionary powers, compelling it to increase Mrs. Rietz’s allowance by 21.5 percent, is error. The obligation rests primarily upon the beneficiary to show a need for additional income, and before a court should intervene there must be a showing that the trustee has acted improperly. That has not been done in this case. Accordingly, the judgment appealed from is affirmed insofar as it relates to consideration of Mr. Rietz’s ability to support Mrs. Rietz. In all other respects the judgment is reversed and remanded.

McNULTY and BOARDMAN, JJ., concur.


Cases With Similar Vibessemantic neighbors from the corpus


Citator

Cited By

  • Richter v. Hofmann, 731 So. 2d 36 (Fla. 3d DCA 1999)
    …PER CURIAM. Affirmed. Barnett Banks Trust Company v. Herr, 546 So. 2d 755 (Fla. 3d DCA 1989); Sarasota Bank & Trust Co. v. Rietz, 297 So. 2d 91 (Fla. 2d DCA 1974).…
  • Barnett Banks Tr. Co., N.A. v. Herr, 546 So. 2d 755 (Fla. 3d DCA 1989)
    …ing she enjoyed at the time of the testator’s death without selling off her non-income producing assets. We have not overlooked the trustee’s extensive arguments to the contrary, but are not persuaded thereby. See Sarasota Bank & Trust Co. v. Rietz, 297 So. 2d 91, 92 (Pla. 2d DCA 1974); In re Johnson’s Estate, 46 Misc.2d 52, 258 N.Y.S.2d 922 (Surr.Ct.1965); In re Robichon’s Will, 105 N.Y.S.2d 491 (Surr.Ct.1951). See generally Annotation, Propriety of Considering Beneficiary’s Other Means Under Trust Provisio…
  • NCNB Nat'l Bank OF Fla. v. Shanaberger, 616 So. 2d 96 (Fla. 2d DCA 1993)
    …tent concerning principal invasions, we review only the trustee’s scope of discretion. A trustee’s exercise of its discretion is not subject to control by the court [*98] except to prevent an abuse of discretion. Sarasota Bank & Trust Co. v. Rietz, 297 So. 2d 91 (Fla. 2d DCA 1974). A trustee is always subject to accountability to remain-dermen where discretion is improperly, arbitrarily or capriciously exercised. Mesler v. Holly, 318 So. 2d 530 (Fla. 2d DCA 1975). Even an unlimited power of invasion is subj…

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