Franzen v. Northwest Bank Colorado

955 P.2d 1018 (1998)

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Nature of the Case

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Facts

James Franzen, the settlor, executed an instrument creating a trust designed to provide for himself and his wife, Frances, in their old age. The corpus consisted of three bank accounts totaling $74,251.19 but did not include other assets as their home which was held in joint tenancy. James was terminally ill when he created the trust and died four months later. Frances opted to leave the trust intact for her lifetime as she was living in a nursing home. Northwest Bank, the sole trustee was concerned about the disposition of the nontrust assets and contacted Frances's nephews who were named as remaindermen of the trust. James O'Brien, Frances' bother eventually took charge of the situation and moved Frances to a nursing home in Kentucky and asked the bank to turn over the assets to him. The nephews expressed concern over James' motives and the Bank declined to comply with his requests and filed an interpleader action with the Denver Probate Court. Before the hearing, James sent a power of attorney and a letter to revoke the trust and remove the bank as trustee. The Court ruled that James' power of attorney was valid but that the trust had not been revoked and because a conservator was not available, appointed the Bank as a special fiduciary to use the assets to make payments for Frances' benefit.