PROBATE CORNER

By: David M. Garten, Esq.

ARTICLE: Will The Real Party In Interest Please Stand Up?

Who is the “real party in interest” to prosecute or defend an action on behalf of an estate, trust, or guardianship? Fla. R. Civ. P. 1.210(a) provides that “[e]very action may be prosecuted in the name of the real party in interest, but a personal representative, administrator, guardian, trustee of an express trust … may sue in that person’s own name without joining the party for whose benefit the action is brought.” The same rule applies in the probate division.

  1. ESTATES:With regard to estates, the personal representative is the real party in interest. A personal representative is the fiduciary appointed by the court to administer the estate and may prosecute or defend claims or proceedings in any jurisdiction for the protection of the estate and of the personal representative. See §§731.201(28) and 733.612(20), F.S. See also §733.607 (The PR shall take all steps reasonably necessary for the management, protection, and preservation of the estate until distribution and may maintain an action to recover possession of property or to determine the title to it.) and §733.309 (Any person taking, converting, or intermeddling with the property of a decedent shall be liable to the PR or curator, when appointed, for the value of all the property so taken or converted and for all damages to the estate caused by the wrongful action.)

    However, with regard to recovery of inter vivos transfers, the beneficiaries of the decedent’s estate are the real party in interest because inter vivos transfers are not estate assets. See Parker v. Parker, 185 So. 3d 616 (Fla. 4th DCA 2016).

    The “estate” is not the real party in interest because the estate is not an entity. The real party in interest is the personal representative whose job is to act on behalf of the estate. See Spradley v. Spradley, 2017 Fla. App. LEXIS 3034 (Fla. 2nd DCA 3/8/17); Randolph Fndn. v. Appeal Fr. Prob., Ct. Sup. 4795 (Conn. Super. Ct. 2001).

  2. GUARDIANSHIPS:
    With regard to guardianships, the guardian is the real party in interest. A guardian is a person who has been appointed by the court to act on behalf of a ward’s person or property, or both, and upon court approval may prosecute or defend claims or proceedings in any jurisdiction for the protection of the estate and of the guardian in the performance of his or her duties. See §§744.102(9) and 744.441(11), F.S.
  3. TRUSTS:
    With regard to trusts, as a general rule, the trustee is the real party in interest. A trustee is authorized to prosecute or defend, including appeals, an action, claim, or judicial proceeding in any jurisdiction to protect trust property or the trustee in the performance of the trustee’s duties. See §736.0816(23), F.S. See alsoFirst Union Nat’l Bank v. Jones, 768 So. 2d 1213 (Fla. 4th DCA 1999) (“the trustee” is merely the legal entity who is sued when an action is brought against “the trust.”).

    The “trust” is not the real party in interest because a trust is not an entity. As a general rule, the real party in interest is the trustee whose job is to act on behalf of the trust. SeeRandolph Fndn. v. Appeal Fr. Prob., Ct. Sup. 4795 (Conn. Super. Ct. 2001), wherein the court stated:

    A number of treatises have discussed the fact that a trust is not an entity. The leading treatise characterizes a trust as, “a fiduciary relationship with respect to property, subjecting the person by whom the title to property is held to equitable duties to deal with the property for the benefit of another person, which arises as a result of a manifestation of an intention to create it.” I Scott, Trusts § 2.3 (4th Ed. 1987). “As against a person acting adversely to the trustee, it is the trustee who is the proper party to maintain an action at law or a suit in equity.” IV Scott, Trusts § 280 (4th Ed.), citing Brown v. Hart, 91 Conn. 667, 670 (1917). See also Treat v. Stanton, 14 Conn. 445 CT Page 4814 (1841) (“The right of action at law has, therefore, been wisely vested solely in the party having the strict legal title and interest.” Id. 455. “In such case, the obligation and legal responsibility is exclusively to the trustee and must be enforced by him in a court of law.” Id. 454.). * * * * “As a general rule, the trustee is the proper person to sue or be sued on behalf of a trust.” 76 Am.Jur.2d, Trusts § 656. “A trustee is a necessary party to assert or defend title to trust property, and is an indispensable party to an adjudication of rights of beneficiaries in a trust.” 76 Am.Jur.2d, Trusts § 672. “Where a trust estate is liable directly on a contract or for goods or services provided it, or for a tort . . . the proper practice is either to sue the trustee as such or to join the trustee and beneficiary as defendants.” 76 Am.Jur.2d, Trusts § 679.* * * *A number of other jurisdictions have addressed the issue of whether a trust is an entity that can sue and be sued. These decisions support this court’s decision. Coverdell v. Mid-South Farm Equipment Assn., Inc., 335 F.2d 9, 12 (6th Cir. 1964) (A trust cannot sue or be sued, but rather legal proceedings are properly directed at the trustee, citing 1 Restatement (Second), Trusts § 2, p 2. (1959); and 54 Am.Jur., Trusts §§ 570, 584, 586 and 588; Limouze v. M.M. P. Maritime Advancement, Training, Education, and Safety Program, 397 F. Sup. 784, 789-90 (D. Md. 1975) (The defendant, an incorporated trust not registered as a business trust, was held to be an entity not capable of the being sued. “In the absence of statute or case law, the weight of authority is clear that the trust estate is not a person in the eyes of the law and does not have the capacity to be sued as an entity.”); Yonce v. Miner’s Memorial Hospital Assn., Inc., 161 F. Sup. 178, 187-88 (W.D. Va. 1958) (Suit against an unincorporated union welfare fund dismissed. Trustees of fund were not joined.).

    However, in some circumstances, the beneficiary of the trust is the real party in interest to pursue recovery of trust assets. See Kent v. Kent, 431 So.2d 279(Fla. 5th DCA 1983) (fraudulent conspiracy between the trustee and a third party to transfer real estate); St. Martin’s Episcopal Church v. Prudential-Bache Secur., Inc., 613 So. 2d 108 (Fla. 4th DCA 1993) (fraudulent scheme between the trustee and a third party to generate excessive commissions).