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Court Decides Suit Regarding Family Trust

The document sued upon is a Family Trust.

On 19 May 1999, a Family Trust, a revocable inter vivos trust, was created. It is a 29-page document with nine articles. A, the settlor, is the mother of plaintiff and defendant. A, and her husband, B, are the co-trustees.

A New York Probate Lawyer said that according to the Family Trust, its purpose is to hold property, which was attached to and made part of the agreement, together with such monies, securities and other assets as the trustee may thereafter at any time hold or acquire (said monies, securities and other assets, referred to collectively as the “Trust Estate”) for the purposes of providing income to the settlor during her lifetime, paying her funeral expenses, estate taxes, probate fees, legal and accounting fees related to her estate, satisfying any cash bequests, all inheritance taxes, funding a marital share deduction, providing income for the benefit of her husband or their children during her husband’s lifetime and upon his death, paying the balance of the Trust Estate to their children, per stirpes. Further, the Family Trust agreement provided that if A died, the balance of the Trust Estate would be distributed to her husband if he survived her, and that upon his death, or the settlor’s death if her spouse predeceased her, the trustee would pay the balance of the Trust Estate to the settlor’s children, per stirpes.

On 29 September 1999, A died, and, on 6 September 2002, her husband died. Plaintiff and defendant are the trustees under the terms of the Family Trust.

Under CPLR 3213, a plaintiff is allowed to commence an action based upon an instrument for the payment of money only by serving a summons and notice of motion for summary judgment and supporting papers in lieu of a complaint. A Nassau County Probate Lawyer said the document comes within the provision if a prima facie case would be made out by the instrument and a failure to make the payments called for by its terms. The instrument does not qualify if outside proof is needed, other than simple proof of nonpayment or a similar de minimis deviation from the face of the document. Where the instrument requires something in addition to the defendant’s explicit promise to pay a sum of money, the provision is unavailable.

As a rule, in determining whether an instrument is one for the payment of money only, the test is not what the instrument may be reduced to by part performance or by elision of a portion of it, but how the instrument read in the first instance.

According to plaintiff, the Family Trust comes within the purview of CPLR 3213, based upon a single sentence in the Family Trust. The court disagrees.

According to the court, the Family Trust goes beyond merely guaranteeing the payment of money, and does not require the payment of any specific amount of money to the plaintiff. In addition, the Family Trust does not contain a specific promise by the defendant to pay a sum of money to the plaintiff. Finally, the Trust Estate’s assets and their value can only be determined through extrinsic means. Therefore, CPLR 3213 is not available here, as the character of the instrument relied upon does not meet the express statutory requirement that it be for the payment of money only.

According to defendant, an action has been commenced to compel an accounting of the estate of A’s husband, and that he has filed certain objections.

Here, a Suffolk County Probate Lawyer said it appears that the accounting was commenced in Surrogate’s Court, Suffolk County, while the objections were filed in Surrogate’s Court, Queens County. However, as the issues relating to the Family Trust are solely between living people and the estate of A’s husband is not a beneficiary of the trust, there is no need to transfer this matter to the Surrogate’s Court.
Accordingly, plaintiff’s motion for summary judgment in lieu of the complaint was denied, and the motion was converted to a special proceeding under article 77 of the CPLR; and defendant’s cross motion to dismiss the motion was denied in its entirety. The moving papers were deemed the petition and answer, and should either party deem it necessary, they may examine one another as trustees as to any matter relating to their administration of the trust in accordance with the provisions of article 31 of the CPLR.
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