Adams's Estate

Citations

• 221 Pa. 77
• 70 A. 436
• 1908 Pa. LEXIS 440

Syllabus

<p>Trusts and trustees — Cotrustees—Liability for default of cotrustee.</p> <p>A trustee is not an insurer of trust funds against the possibility of loss nor a surety for his cotrust^e. His undertaking is personal, requiring of him good faith and reasonable diligence; and if these requirements be met, he is not liable for losses occasioned by the bad faith or embezzlement of his cotrustee. The law requires of the trustee fidelity to the trust, and the exercise of the same measure of diligence that a man of ordinary prudence may be expected to exercise in the care of his own property under the same circumstances.</p> <p>While as a general rule a trustee is not liable for trust funds received by his cotrustee, yet he is required to exercise a general superintendence and care over the trust. If he hear of any fact tending to call his attention to mismanagement or misapplication of trust funds by his co-trustee it is his duty to intervene and prevent a devastavit. His failure to do so would be a breach of trust imposing liability upon him for loss.</p> <p>The joint receipt by cotrustees of trust funds imposes a joint liability. The obligation rests upon each trustee to exercise good faith and usé reasonable diligence in executing the trust. If through the negligence or default of either trustee, the other trustee is permitted to dissipate the funds or convert them to his own use, he is responsible for the loss. The possession of the trust funds is joint, and it is the duty of each trustee to exercise good faith and reasonable care to protect the trust funds against his cotrustee as well as against others.</p> <p>The fact that one of two trustees bestowed the same degree of care on his own interest in the trust estate and upon his own private securities as he did upon the interest of the other cestuis que trustent is no excuse for his dereliction of duty in not properly guarding the trust estate from a default on the part of his cotrustee; nor is the illness of such a tr