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Jacob v. Davis - 128 Md. App. 433, 738 A.2d 904 (1999)

Rule:

The beneficiary is entitled to demand of the trustee all information about the trust and its execution for which he has any reasonable use. If the beneficiary asks for relevant information about the terms of the trust, its present status, past acts of management, the intent of the trustee as to future administration, or other incidents of the administration of the trust, and these requests are made at a reasonable time and place and not merely vexatiously, it is the duty of the trustee to give the beneficiary the information for which he has asked. 

Facts:

Appellant William H. Jacob (Bill) is the sole remainderman of two trusts established under the last will and testament of his father, John B. Jacob (John). Under the terms of the trust, Bill's mother and appellees, Michael W. Davis, the surviving trustee of those trusts, and Davis's law firm, Ahlstrom & Davis, P.A., were named as trustees. After his mother's death, Bill sued the attorney and the law firm, alleging numerous violations of appellees' fiduciary duties as trustees, and seeking an accounting, other equitable relief, and damages. The complaint included the following: 1) breach of fiduciary duty; 2) declaratory relief; 3) injunctive relief; 4) breach of contract; 5) tortious breach of covenants of good faith and fair dealing; 6) negligence; 7) trover and conversion; and 8) an accounting and establishment of a constructive or resulting trust. Ruling on a motion made by appellees at the end of Bill's case, the trial court entered judgment pursuant to Maryland Rule 2-519 in favor of appellees on all eight counts. Bill sought appellate review.

Issue:

Was Bill, as the sole remainderman of two trusts established under the last will and testament of his father, entitled to an accounting?

Answer:

Yes

Conclusion:

On appeal, the judgment was vacated in part. The appellate court concluded that Bill was entitled to an accounting, because trustees must render an accounting when asked to do so at reasonable times by the beneficiaries, notwithstanding contrary language in the trustor's will. Furthermore, Davis failed to allocate receipts and expenses between trust income and trust principal as required by the Principal and Income Act, Md. Code Ann., Est. & Trusts §§ 14-201 et seq.

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