Hart's Estate

Citations

• 203 Pa. 480

Syllabus

<p>Trusts and trustee — Improper investment — Surcharge.</p> <p>Where a testator leaves his estate to his son in trust to pay portions of the income to testator’s wife and daughters during the life of the wife, and to distribute the principal after the death of the wife to bis son and daughter, and authorizes his trustee to sell any part of his estate and to invest the proceeds in such other securities as may in his judgment seem best, the trustee is not authorized to invest $10,000, of the estate in an issue of bonds amounting to $350,000, secured by a mortgage on a manufacturing plant in another state, where it appears that the trustee knew nothing of the value of the plant, whether estimated by what it would bring at a sale in the market, or by its income from operation, and where it appears that he consulted no one before purchasing, except his brokers, anda person who had guided his father in investments, and it also appears that the company defaulted on the mortgage interest within less than two years after the purchase. If the trustee makes such an investment, and a loss results from it, he will be surcharged.</p> <p>Where a trustee neither exercises common skill, common prudence, nor common caution, and is either guilty of supine negligence in being ignorant of facts which ordinary intelligence would have disclosed to him, or if known, in not exercising his best judgment upon them, and a loss results, he will be surcharged.</p>