Monday, April 14, 2014
Interest on Damages for Improper Discretionary Distributions Payable Only from Date of Beneficiary’s Death
The trustee was found liable for making improper discretionary distributions of principal to the sole life income beneficiary of the trust. The trial court awarded prejudgment interest at the statutory rate from the date of each principal invasion and the intermediate appellate court affirmed. On appeal by the trustee, the Supreme Court of Georgia reversed, holding that interest could be awarded only from the date of the life income beneficiary’s death because had the improperly distributed assets remained in the trust, any interest they would have earned would have been distributed to the life beneficiary. Reliance Trust Co. v. Candler, 751 S.E.2d 47 (Ga. 2013).
Special thanks to William LaPiana (Professor of Law, New York Law School) for bringing this case to my attention.