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Court Orders Granddaughter to Pay Back Grandmother's Estate

By Christina Vidoli

 

In Michaud v. Forcier, et al. (Mass. App. Ct., No. 09-P-392, Oct. 5, 2010), the Massachusetts AppealsCourt orders reformation of a trust instrument after finding decedent’s intent was not carried out due to her granddaughter’s breach of a fiduciary duty.

Marianna Forcier created a nominee trust in which she placed her real estate, giving her daughter, Mary Forcier, and two grandchildren. Lisa Michaud and Robert Hunnefield, equal shares as remainder beneficiaries. Later, Marianna conveyed almost half of the real estate in the trust to Lisa.

While the terms of the trust required all beneficiaries to consent to such a transfer of trust property, Lisa was the only beneficiary aware of the existence of the trust and its terms and her attorney drew up the papers. Despite this, the deed falsely stated that all trust beneficiaries had consented.

Following the conveyance, the Marianna stated on numerous occasions that she intended the conveyance to be in lieu of any inheritance to Lisa. She instructed Lisa to assist her in amending her estate plan, but she never did.

The Probate Court established that Lisa abused the confidence and trust that her grandmother believed to have with her. Here, the Appeals Court affirms the Probate judge’s order for reformation of the trust, to exclude Lisa from the schedule of beneficiaries. The court relies on the decedent’s estate plan and testimony of her former attorney in identifying that it was her intent all along to treat her daughter and two grandchildren equally. The land transfer to Lisa was intended, as Lisa knew, to be in lieu of the interest that she would have taken from the trust upon her grandmother’s passing.

The Appeals Court also upholds the Probate Court’s ruling regarding the decedent’s bank account. Marianna had added Lisa’s name to the account and upon her passing, Lisa completely withdrew the contents of the jointly held bank account. Relying on Marianna’s established intent to treat her daughter and grandchildren equally, the court ordered Lisa to repay the amount she withdrew back to the estate, ruling that this bank account was set up jointly as a matter of convenience and was not meant to be a completed gift.