Gilmore v. Rotan, No. 11-16-00253-CV, 2018 WL 4496232 (Tex. App.—Eastland Sept. 20, 2018, no pet.).


Breach of Duty


Residual trust beneficiaries filed suit alleging that the trustees breached their fiduciary duties when they transferred real property to themselves thereby depleting trust assets. The deed was dated in 2003 and recorded in 2010. The appellate court upheld summary judgment in favor of the trustees because the statute of limitations had run prior to the beneficiaries filing suit in 2015.


A claim for breach of fiduciary duty is normally governed by a four year limitation period which begins to run from the date “the claimant knows or in the exercise or ordinary diligence should know the wrongful act and resulting injury.” The court agreed that the beneficiaries had both constructive and actual notice of the alleged self-dealing conveyance when the deed was filed in 2010.


Moral:  Lawsuits need to be filed before the statute of limitations expires.