Famous TV doctor Mehmet Oz—better known as “Dr. Oz”—recently accused his sister, Nazlim, of forging their late father’s will and stealing millions from his estate. A 2008 will left all of Mustafa Oz’s assets to the Mustafa Oz Foundation, a United States organization, and left Dr. Oz in charge of the foundation; however, Nazlim presented a new will dated 2018 after Mustafa’s death, which Dr. Oz claims is forged. Mustafa Oz passed away in Turkey in 2019, and litigation regarding his estate subsequently commenced in Turkey. Turkish prosecutors reportedly followed some of the money to bank accounts in at least three other countries. The Turkish estate dispute is proceeding alongside a…
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THIRD PARTY BENEFICIARIES TO CONTRACTS
ABC Seller agrees to sell 100 widgets to XYZ Buyer for $10 per widget. This agreement creates a contract, which largely governs the rights and obligations of ABC Seller and XYZ Buyer. However, contracts such as this often impact additional entities or individuals beyond the parties themselves. For example, ABC Seller may need to contract with a manufacturer, who in turn may need to contract with components manufacturers, to honor XYZ Buyer’s order. ABC Seller and/or XYZ Buyer may need to contract with a shipping company to deliver the widgets. To the extent XYZ is selling the widgets to an end user, the end user will also benefit from the…
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Stormy Daniels and Uber: How Nondisclosure Agreements Affect Your Rights
Lately the term “non-disclosure agreements” (or “NDAs”) have inundated the news. These secretive agreements are now forefront in headlines about Stormy Daniels’ alleged affair with President Trump and Uber’s evolving corporate culture in response to claims of sexual harassment and discrimination. This has left many non-lawyers wondering: why do parties enter non-disclosure agreements and how do these agreements work? NDAs are contractual agreements designed to keep specified information confidential. Such agreements list and/or describe the information prohibited from disclosure and the punishment for disclosing such information, often, a large sum of money known as liquidated damages. Generally, parties are free to enter a non-disclosure agreement regarding any information, except that…
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Breach of Trustees’ Fiduciary Duty – Part 4: Duty to Delegate
At common law, trustees had a fiduciary duty not to delegate tasks they can perform themselves. However, our current financial system’s increasing complexity makes it unreasonable for many trustees to manage trust assets on their own. The opportunities for investments are endless, and the sophistication of even basic financial instruments has increased since the creation of the common law duty not to delegate tasks. As a result, it is often in the best interests of all parties – including the trustee – to enlist the help of experienced professionals who can assist with investment decisions. Doing so ensures the trust’s assets are financially productive and protected. When delegating his…
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Breach of Trustees’ Fiduciary Duty – Part 3: Duty to Administer Trusts Prudently and Duty to Inform, Report, and Maintain Adequate Records
In Part 2 of this series, we examined trustees’ duties of loyalty and impartiality. This post will examine the duty to administer trusts prudently and Part 4 will discuss the duty to delegate – or not delegate – in more depth. The duty to administer trusts involves the basic values of good faith, while the duty to inform, report, and maintain adequate records involves the reasonableness of a trustee’s actions. While these principals seem straight forward, they are a bit nuanced in practice. Duty to Administer Trusts Prudently The duty to administer trusts prudently mandates trustees carry…
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Breach of Trustees’ Fiduciary Duty – Part 2: Duty of Loyalty & Duty of Impartiality
As we’ve mentioned in part 1 of this series, trustees are fiduciaries and, as such, trustees owe a variety of fiduciary duties to multiple parties. These obligations include both the duty of loyalty and duty of impartiality, which we will discuss this week. To prove a trustee breached of one of these duties, one must show three things: (1) the existence of a fiduciary relationship; (2) the breach of a fiduciary duty; and (3) damages proximately caused by the breach of the duty.[1] It is important to keep in mind that the express terms of the trust can modify…
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Breach of Trustees’ Fiduciary Duty – Part 1: General Considerations
This is the first of a four-part series examining trustee’s fiduciary duties and the circumstances that could result in litigation. To begin, we will discuss basic principles that will lay a groundwork to inform our larger discussion. What is a Trust and a Trustee?[1] A trust is a financial instrument or tool through which people can transfer their assets to others over time. People who create trusts are called “settlors,” because they “settle” or initially put assets into the trust. Those who stand to benefit from the assets in the trust are known as “beneficiaries.” The person…
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Accelerating Estate Disputes: The Living Probate Option
North Carolina joins four other states in providing a path to ensure decedents’ assets are distributed according to their wishes upon death.[1] The North Carolina General Assembly recently enacted legislation amending statutes regarding estate administration by adding a procedure for “living probate.” This action is usually commenced by a testator – the author of a will – prior to his or her death where he or she anticipates a challenge to the will’s validity. The court can now declare a will is valid while the testator is alive, thereby preventing potentially more expensive litigation after the testator’s death, when he or she is unable to…
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Six Ways to Challenge a Will’s Validity
Wills must meet several basic requirements to be valid and enforceable under state law. If any of the below factors are at work, then a will’s validity may be challenged. (1) Undue Influence Undue influence exists when a person uses coercion to influence the testator (the person creating a will) into executing a will that does not accurately reflect the testator’s true wishes. There are several red flags to keep in mind if you are suspicious a loved one’s will is the product of undue influence. Unusual dispositions of property, sickness and vulnerability of the testator to undue influence,…
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North Carolina Court of Appeals Clarifies Reach of Clerk of Court’s Original Jurisdiction
A recent decision by the North Carolina Court of Appeals reinforced the distinction between claims over which the trial divisions have original jurisdiction and claims which are properly brought before the Clerk of Court.[1] In Morgan-McCoart v. Matchette, an elderly woman, Ms. Simpson, created a revocable trust and executed a Durable Power of Attorney in 2008. Her daughter, Julie, was named as her trustee and attorney-in-fact, and her other daughter, Claudia, was named as the alternate trustee and attorney-in-fact. Ms. Simpson was declared incompetent in 2009. Julie lived in California, making it difficult to fulfil her duties. Accordingly, Julia…
