Colonial American Cas. and Sur. v. Scherer, 214 S.W.3d 725 (Tex. App.—Austin 2007, no pet.).

Estate Administration

Bond

 

Original Administrator of the decedent’s estate breached numerous statutory and common law duties. Accordingly, Original Administrator was removed from office and replaced by Successor Administrator. Successor Administrator proceeded against Bond Company for damages caused by the breaches as well as for attorney’s fees. The trial court awarded both damages and attorney’s fees and Bond Company appealed.

The appellate court held that an award of attorney’s fees against Bond Company was proper. Probate Code § 245 provides that the personal representative and the sureties on the bond are liable for reasonable attorney’s fees incurred in removing the personal representative. However, the total amount of Bond Company’s liability, that is, for damages caused by the breaches of duty plus the attorney’s fees, may not exceed the penal amount of the bond.

Moral: A surety may be responsible for attorney’s fees incurred because of the conduct of the bonded person. However, the total recovery (damages plus attorney’s fees) may not exceed the amount of the bond.



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