Fiduciary Duties

Sterling Trust Co. v. Adderley, 168 S.W.3d 835 (Tex. 2005).


In a complex securities fraud case, the Supreme Court of Texas addressed the propriety of a jury instruction regarding breach of fiduciary duty under former Trust Code § 113.059. The instruction failed to reflect the possibility that the standard of care may be modified by agreement. Because the instruction did not account for contractual modifications, the court determined it was overly broad and consequently defective.

Moral: Within statutorily-defined parameters now found in Trust Code § 111.0035, the settlor may modify the trustee’s fiduciary duties.