Fulp v. Gilliland

998 N.E.2d 204 (2013)

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Nature of the Case

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Facts

Ruth and Harold Fulp Sr. married. They moved to the family farm and raised their three children-Harold Jr., Nancy, and Terry. Harold Sr. farmed the land; Junior later joined him, then took over after Senior's death. Ruth placed her family farm in a revocable trust, reserving the right to revoke or amend the trust and to use its assets-with any remaining trust assets going to her three children upon her death. A few years later, she decided to sell the farm to her son, P, for a low price, to pay for her retirement-home care and keep the farm in the family. Ruth's daughter, Nancy Gilliland (D), argued that a bargain sale would breach Ruth's fiduciary duty to her children and deprive Nancy of 'her share' of the trust. P paid $450,252, but an appraisal later showed it was worth more than $1 million. D objected to the sale because she 'wanted her share.' Ruth resigned as trustee. D then became successor trustee and refused to proceed with the sale, and P sought specific performance of the purchase agreement. The trial court found that Ruth was competent to sell the farm, the price paid for the farm was adequate. The court denied specific performance because it found that Ruth breached her fiduciary duty to the children by selling the farm at a low price, and P breached his fiduciary duty as a beneficiary by participating in the sale. The Court of Appeals affirmed, and P appealed.