Lessons From the Bench: Remedies for Breach of Fiduciary Duty

February 11, 2011

The role of a fiduciary – an executor, an administrator, a trustee, and even a guardian – brings with it essential duties and responsibilities of loyalty, honesty, and good faith. Through the decision in In re Brissett, 7/26/2010 NYLJ 26 (col 6) (Sur Ct, Bronx County) we learn that a fiduciary who fails to fulfill this role can be removed from office, or worse yet, held in contempt of court and face imprisonment.

In In re Brissett, the Surrogate’s Court, Bronx County, held the executrix of the estate in contempt for failing to timely file an accounting.  The record revealed that the decedent died in 2004 survived by her spouse, who post-deceased her. Her Will was admitted to probate several years after her death, and letters testamentary issued to her niece, as the named executrix.

Following the issuance of letters testamentary, a proceeding was instituted to compel the executrix to account. The application was granted, and the executrix was ordered to account within thirty days of service upon her of a certified copy of the court’s order. When no account was filed, a petition was filed requesting that the executrix be held in contempt. The application was granted upon the default of the executrix, and the court authorized the issuance of a warrant of commitment without further notice in the event the executrix failed to account within thirty days of service upon her of the court’s order with notice of entry.

Thereafter, a warrant of commitment issued and the executrix was brought before the court by the Sheriff of the City of New York. At that time, counsel for the executrix stated that the their client’s failure to account was attributable to their law office failure rather than her willful disregard of the court’s order. Based on counsel’s representations, the court temporarily vacated the order of commitment, provided that in the event the executrix failed to account by a date certain, the warrant would once again issue. A warrant of commitment was again issued as a result of the executrix’s failure to account, and yet another stay was granted until a date certain.

However, in lieu of filing her account, the executrix moved for an extension of time to file her account and for another stay of the warrant of commitment pending the outcome of the application.

In opposition to the relief requested by the executrix, the respondents maintained that she transferred to herself all estate assets, contrary to the provisions of the decedent’s Will, and requested that the court, inter alia, issue an order revoking the letters testamentary of the executrix, appointing one of them as the fiduciary of the estate, and imposing sanctions.

The court opined that although a warrant of commitment remained outstanding, the remedies afforded by the provisions of SCPA §2205 were likely to prove more fruitful than the imprisonment of the executrix for failure to comply with the court’s directives. Accordingly, the court denied the request by the executrix for another extension of time to account, suspended the letters testamentary issued to her, directed that a hearing be held on the issue of whether the executrix’s letters testamentary should be revoked and one of the respondents be appointed in her place and stead, and ordered that on the hearing date the parties be prepared to discuss a turnover of the books and records of the estate, and whether a trial date should be fixed for the successor fiduciary to take and state the account of the suspended executrix.


Practice Tip:  Absent grounds for disqualification, a duly nominated executor is entitled to preliminary letters testamentary to provide for the immediate administration and protection of the assets of the estate in instances where there may be a delay in probate. See In re Rullan, 11/15/2010 NYLJ.19 (col 2) (Sur. Ct. Bronx County).