William G. Schwab and Associates
811 Blakeslee Blvd. Dr. East (PA Route 443) PO Box 56 Lehighton, PA 18235
Tel 610-377-5200 Fax 610-377-5209
NEWSLETTER
Estate Planning/Probate October 20, 2014
 
Personal Injury
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The Meaning of Probate

Probate, a Latin term meaning "to prove the will," is a court-supervised process that settles a person's affairs after death. ...(more)

 

The Living Trust

Unlike a will or some other types of trusts, which take effect upon the death of their creator, a "living ...(more)

 

Resulting Trusts

There may be instances where property under a trust is transferred to the wrong beneficiary. This transfer can be corrected ...(more)

 

Court-Appointed Conservators

A "conservator" is a court-appointed individual assigned to handle the daily affairs of those who cannot care for themselves due ...(more)

 

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Court-Imposed Transfers: Constructive Trusts


A constructive trust is a remedy imposed by a court when a person has wrongfully attained property in an inappropriate way. The court will undo the transaction and order that title to the property go to the rightful owner.

Types of Wrongful Conduct
Any wrongful activity that leads to the unfair obtainment of property may be cause for a constructive trust, including:

  • Fraud (including forgery)
  • Theft (including embezzlement)
  • Accident
  • Mistake
  • Undue influence
  • Violation of fiduciary duty (for example, where a partner purchases property in his own name rather than in the name of the partnership)

Factors
In order for a constructive trust to be created, the following factors must exist:

  • Fraudulent representations or concealment of important and material information, or breach of trust
  • Acts such as transfer of property as a result of the fraud or breach
  • Profit and/or unjust enrichment as a result of fraudulent representation or concealment of important and material information

Remedy Under Constructive Trusts
A constructive trust is imposed when an affected party initiates a lawsuit requesting relief. It typically provides that the property pass from the wrongful owner to the rightful owner.

However, if the unlawful owner has damaged or destroyed any of the property, the rightful owner is entitled to a money judgment for the value of the property.

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