The master recommended that 8% interest run from date of final decree or from the date appearances were filed by the beneficiaries in opposition to the allowance of the trustee's accounts. Cf. G.L.c. 231, §§ 6B, 6C. The probate judge allowed 6% simple interest from the dates when losses were realized by sale, citing National Academy of Sciences v. Cambridge Trust Co., 370 Mass. 303, 311 (1976). See G.L.c. 107, § 3.
In my view, today's decision creates an exception to the comprehensive scheme enacted by G.L.c. 185, §§ 26-56A "almost as broad as the scope of the general rule otherwise contained in that [chapter]." National Academy of Sciences v. Cambridge Trust Co., 370 Mass. 303, 313 (1976) (Wilkins, J., dissenting in part). The extension of the doctrine announced in the State St. Bank Trust Co. case to the facts of this case leaves entirely unclear the degree of care a would-be registrant of title must exercise to obtain the benefits of the land registration procedure provided by the Legislature.
Welch v. Flory, 294 Mass. 138, 144 (1936). See National Academy of Sciences v. Cambridge Trust Co., 370 Mass. 303, 307 (1976). Here, the remainder of Cappy's trust has not yet been distributed, and there is no reason to depart from the usual rule of impressing a constructive trust in favor of Cappy's estate on the amounts wrongfully withheld.
Youngblood v. Taylor, 89 So.2d 503 (Fla. 1956); Jackson Grain Co. v. Lee, 150 Fla. 232, 7 So.2d 143 (1942).Nat'l Academy of Sciences v. Cambridge Trust Co., 370 Mass. 303, 346 N.E.2d 879 (1976); In Re Enger's Will, 225 Minn. 229, 30 N.W.2d 694 (1948). 3 A. Scott, supra note 11, § 220.
Burlingham v. Worcester, 351 Mass. 198, 202 (1966). National Academy of Sciences v. Cambridge Trust Co. 370 Mass. 303, 310 (1976). We conclude that the plaintiff assented to Coggan's accumulation of the trust income to which Anderson was previously entitled with full knowledge of the facts.
If so, we are not persuaded that such fraud has been established in this case. The GAL relied on National Academy of Sciences v. Cambridge Trust Co., 370 Mass. 303, 309 (1976) (National Academy), in which we held that "constructive fraud" constitutes "fraud" for purposes of G. L. c. 206, § 24, "at least to the extent that the fiduciary has made no reasonable efforts to ascertain the true state of the facts it has misrepresented in the accounts." Id. at 308.
The record supports the judge's exercise of discretion in denying Lattuca's motion for attorney's fees. See National Academy of Sciences v. Cambridge Trust Co., 370 Mass. 303, 312 (1976) ("trustee is not entitled to indemnity if the incurring of the expense became necessary because of his own fault"). In other jurisdictions, a trustee "is entitled to indemnity for expenses not properly incurred by him if and to the extent to which he has thereby in good faith benefited the trust estate" (emphasis added).
It is the duty of the beneficiaries and guardian ad litem to examine the accounts and to make their objections. National Academy of Sciences v. Cambridge Trust Co., 370 Mass. 303, 310 (1976). Burlingham v. Worcester, 351 Mass. 198, 202 (1966).
See, e.g., Allard v. Pacific Nat. Bank, 663 P.2d 104, 112 (Wash. 1983) ("A trustee whounsuccessfully defends against charges of breach of fiduciary duties obviously has not caused a benefit to the trust. Therefore, a trial court abuses its discretion when it awards attorney fees [from the trust] to a trustee for litigation caused by the trustee's misconduct.") (emphasis added); Nat'l Acad. of Sciences v. Cambridge Trust Co., 346 N.E.2d 879, 885 (Mass. 1976) (stating that a "trustee is not entitled to indemnity if the incurring of the expense became necessary because of his own fault"); In re Baird's Estate, 287 P.2d 372, 376 (Cal. App. 1955) ("Where a trustee by reason of his own greed or indifference has breached his duty to the trust and has thereby brought on litigation against it his expense must be borne out of his own property." (quoting In re Estate of Vokal, 263 P.2d 64, 69 (Cal. App. 1953))).
Jordan further argues that, even if the account was properly reopened under § 24, there was insufficient evidence to support the judge's finding that Jordan failed to act reasonably, violated his fiduciary obligations, and therefore should be surcharged. In reopening the account under § 24 for "fraud or manifest error," the judge applied the doctrine of constructive fraud recognized in the seminal trust case of National Academy ofSciences v. Cambridge Trust Co., 370 Mass. 303, 308-309 (1976). That case involved a testamentary trust subject to a restrictive provision terminating distribution of income to the testator's widow upon remarriage.