Alpert v. Gerstner, 232 S.W.3d 117 (Tex. App.—Houston [1st Dist.] 2006, pet. denied).




The probate court appointed Receiver to take possession of all trust property and to manage it under the terms of the trust. Later, Beneficiaries sued Receiver alleging that she breached her fiduciary duties. For example, they asserted that she did not manage the property prudently which caused a stock portfolio to decline in value from $600,000 to $13,000. The trial court agreed with Receiver that Beneficiaries’ claims were barred by judicial immunity. Beneficiaries appealed.

The appellate court reversed. The court recognized that whether a court-appointed receiver is entitled to judicial immunity is an issue of first impression in Texas. The court then engaged in a comprehensive discussion of when “derived” judicial immunity is proper, that is, when the judge’s immunity passes along to a person, like Receiver, to whom the court delegates duties. The court explained that immunity is proper if the person is intimately associated with the judicial process and is exercising discretionary judgment comparable to that of a judge.

After reviewing analogous Texas cases, the court held that Receiver was entitled to derived judicial immunity to the extent that she was authorized to take charge and keep possession of the trust property, prepare an inventory of trust property, and assist the court in determining who should be the trust of the trusts. “These functions are intimately associated with the judicial process and involve the exercise of discretionary judgment comparable to that of a judge.” Alpert at 130. However, Receiver is not entitled to derived judicial immunity for the alleged breaches of fiduciary duties to the beneficiaries in failing to exercise good faith or ordinary care in managing trust property. At this point, Receiver was acting as a representative of the interests of the beneficiaries, not as an agent of the court.

Moral: A trust receiver should comply with all the normal duties of a trustee and cannot rely on derived judicial immunity for protection.