Under N.J.S.A. 3B:31-72(a),[a] trustee who commits a breach of trust is liable to the beneficiaries affected for the greater of: (1) the amount required to restore the value of the trust property and trust distributions to what they would have been had the breach not occurred; or (2) the profit the trustee made by reason of the breach.
Consequential damages are damages that naturally flow as a result of the harm caused by the defendant’s wrongdoing. For example, if the trustee’s wrongdoing caused economic harm to the beneficiaries that led to lost income and/or profits, those “[l]ost profits may be recoverable if they can be established with a ‘reasonable degree of certainty.'” Nevertheless, “[a]nticipated profits that are too remote, uncertain, or speculative are not recoverable.” Ibid. For a plaintiff to recover lost profits, the amount lost must be certain, and based on “sound fact[s].” Also, a trial court is within its discretion to award interest on trust funds lost because of a trustee’s neglect.
To discuss your NJ Trust matter, please contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at firstname.lastname@example.org. Please ask us about our video conferencing or telephone consultations if you are unable to come to our office.
By Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright, a Freehold Township, Monmouth County, NJ Trust Attorney