In Gordon vs Gordon, A couple created a revocable trust and named a friend who provided financial advice as successor trustee. No. 03-22-00454-CV, 2024 Tex. App. LEXIS 3611 (Tex. App. – Austin, May 23, 2024, no pet story). The friend, who was not an attorney, also drafted wills for them and named himself executor of their estate. The couple had no children and named their nieces and nephews as beneficiaries, some of whom were the friend’s sons and nieces and nephews. The husband died first and disputes arose between the friend and the widow. There was a prior legal dispute in which the widow prevailed. She then filed suits to remove the friend as executor of her husband’s estate. After a jury trial, the court discharged the friend and he appealed.

The court found that the friend had the following fiduciary duties: “As an independent executor, John had a fiduciary duty to protect the interests of Diane and the other heirs by acting fairly in good faith, loyalty and integrity. An executor’s personal interests must not conflict with his fiduciary duties to the estate and its heirs.” IDThe court then discussed the criteria for removing an executor:

If there is legally sufficient evidence that an executor breached his or her fiduciary duties, for example by failing to disclose estate income and expenditures in required accounts or to beneficiaries, the court’s finding that the executor engaged in gross mismanagement may be affirmed on appeal. Gross mismanagement and gross misconduct include, at a minimum, (1) any willful failure to perform a legal duty; (2) any willful commission of a wrongful act; and (3) any breach of a fiduciary duty that results in actual harm to the interests of a beneficiary.

IDThe court found that there was legally sufficient evidence to support the jury’s finding:

After reviewing the record, including the evidence relied upon above, we conclude that legally sufficient evidence supports the jury’s finding that John engaged in gross misconduct or gross mismanagement as an independent executor. The evidence supports the finding that he placed the interests of his sons, nieces, and nephews above the interests of Diane; that he willfully distributed assets of the estate knowing that such distribution was contrary to the terms of the will and would disproportionately benefit his sons, nieces, and nephews to Diane’s detriment; that his inventory was inaccurate and misleading; that pursuing his claim for unjust enrichment was a waste of estate funds; that he violated a court order and reserve requirements; and that he failed to distribute portions of the estate that rightfully belonged to Diane.

ID. The court then addressed several issues raised by the friend, including whether the will was a contractual will (which it was not), whether the will changed the provisions of financial accounts with beneficiary designations or ROS or POD provisions (which it was not), and whether the will transferred the wife’s community property interests (which it was not). The court set aside the attorney’s fees awarded by the trial court and remanded the matter for further consideration.

Interesting note: An interesting aspect of this case is that the parties apparently agreed to a jury trial on the motion to remove. The jury was instructed to answer the question: “Did John Gordon commit gross misconduct or gross mismanagement in the performance of his duties as an independent executor?” Gross misconduct was defined in the indictment as “obviously obvious or flagrant misconduct” and gross mismanagement as “obviously obvious or flagrant mismanagement.” The jury answered in the affirmative and the court discharged the executor. But what would have been the result if either party had objected to the jury trial?

The Texas Estate’s Code provides: “The courtat the request of the Court or at the request of any interested person and without prior notice, dismiss a personal representative appointed under this Title who…” and “The court may discharge a personal representative upon motion of the court or upon complaint of any interested person after the representative has been summoned by personal service to answer at a time and place specified in the notice if…” Tex. Est. Code § 361.051, 361.052 (emphasis added). Thus, the Texas legislature may have intended that courts, not juries, should discharge trustees and executors.

The Texas Trust Code and the Texas Estate Code do not create a right to a jury trial; rather, any rights to a jury trial are governed by the constitutional rights of the parties. Regarding Poe Trust646 SW3d 771, 778 (Tex. 2022). There are two constitutional provisions that address the right to a jury trial. ID. (citing Barshop v. Medina County, Underground Water Conservation Dist., 925 SW2d 618, 636 (Tex. 1996). The Bill of Rights ensures that the “right to a trial by jury shall remain intact.” Tex. Const. Art. I, § 15. This provision preserves the right to a trial by jury for the kinds of cases that were tried by a jury when the Constitution was adopted, and thus applies “only if a trial by jury would have been authorized in that or any similar case in the year 1876.” ID. When the Constitution was adopted, there was no common law right to a jury trial in equity cases, and so the courts have ruled that the Bill of Rights “does not alter the common law tradition of avoiding jury trials in equity cases.” IDThis provision of the Bill of Rights does not grant a party in a removal action under the Estate or Trust Code the right to a jury trial, as this would not have been permitted under the equity law of 1876.

In addition, Article V of the Judicial Clause provides: “In the trial of all cases in the district courts, the plaintiff or defendant shall, upon motion in open court, have the right to a jury trial; but in civil cases, a jury shall not be called unless requested by a party to the case. The party requesting the calling of a jury shall pay a jury fee in such amount as the Legislature may prescribe, and with such exceptions.” Tex. Const. Art. V, § 10. This provision seems broad, but “for more than a century, the broad language of the Judicial Clause has not ‘covered’ every trial.” Regarding Poe Trust646 SW3d at 779. The Texas Supreme Court stated:

We have identified several proceedings at Credit Bureau that fall outside the scope of the Judiciary Article for “special reasons”: civil contempt of court proceedings, election challenges, habeas corpus proceedings for custody of minor children, actions to remove a sheriff, and appeals in administrative proceedings. 530 SW2d at page 293. However, this list is not exhaustive. ID. (noting that there are “others”). And since Credit Bureau, our appellate courts have held that other proceedings are outside the scope of the Judiciary Article. Previously, we have not formulated a precise test to determine when a proceeding is outside the scope of the Judiciary Article, and the question has instead been resolved on a “case-by-case” basis.

IDThe question therefore remains whether a party is entitled to a jury trial on substantive issues relating to claims for the removal of executors or trustees.