Maxwell
Maxwell v. Maxwell (In re Maxwell)
Opinion
Lead Opinion
Clement, J.
(corrected)
Defalcation requires knowledge of, or gross recklessness in respect to, the improper nature of the relevant fiduciary behavior. Defendant Bobby Maxwell, a trustee, allowed his wife, Cherie Maxwell, a bank officer, to access and handle trust funds. Cherie diverted some of the funds for personal use; Bobby was unable to account for other funds. Bobby was unaware of Cherie’s diversion of trust funds. Has Bobby committed defalcation?
FACTS
Eldridge A. Coffman and Madeline J. Coffman, a married couple, owned 80 acres of farmland, a home, and other personal property. They created a living trust in which the Coffmans were the initial trustees and beneficiaries of the trust. The trust provides that Bobby, the Coffmans’ nephew, would serve as the trustee after the death of both of the Coffmans and that the corpus of the trust would be distributed to the Coffmans’ siblings.
Bobby became the trustee in 2007 after both Coffmans had died. Bobby worked as a corrections officer, and his wife at the time, Cherie, was a bank officer. Bobby relied heavily on Cherie, who is now deceased, to assist him with his financial duties as trustee. Cherie had access to and handled the…