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A breach of fiduciary duty by a Florida trustee is one of the most serious legal claims in trust law. A trustee owes beneficiaries a strict set of duties under Chapter 736 of the Florida Statutes, including loyalty (§ 736.0802), prudent administration (§ 736.0804), impartiality (§ 736.0803), control of trust property (§ 736.0809), and the duty to inform and account (§ 736.0813). When a trustee breaches any of these duties and the trust suffers a loss, the trustee can be held personally liable for the damages — a remedy called a surcharge. The breach we litigate most often is trustee self-dealing, where the trustee stands on both sides of a transaction involving trust property.
Under Florida law, a beneficiary claiming breach of fiduciary duty must prove three elements: (1) the existence of a fiduciary duty (the trustee owed a duty to the beneficiary); (2) breach of that duty (the trustee acted or failed to act in violation of the duty); and (3) damages flowing from the breach (the trust or beneficiary suffered a measurable financial loss). The Fifth District Court of Appeal stated these elements clearly in Crusselle v. Mong, 59 So. 3d 1178, 1181 (Fla. 5th DCA 2011), and the rule was applied in trust cases like Miller v. Miller, 89 So. 3d 962 (Fla. 5th DCA 2012).
The Florida Trust Code imposes the following primary duties on trustees: (1) Loyalty (Fla. Stat. § 736.0802) — no self-dealing or conflicts of interest without authorization; (2) Prudent administration (§ 736.0804) — administer the trust as a prudent person would manage their own affairs; (3) Impartiality (§ 736.0803) — balance competing beneficiary interests fairly; (4) Cost-effective administration (§ 736.0805); (5) Inform and account (§ 736.0813, § 736.08135) — keep beneficiaries reasonably informed and provide annual accountings; (6) Control of trust property (§ 736.0809); (7) Protect trust property (§ 736.0811); (8) Enforce and defend claims (§ 736.0812).
A surcharge action is the remedy used to enforce trustee liability for breach of fiduciary duty. As defined in Miller v. Miller, 89 So. 3d 962 (Fla. 5th DCA 2012) (citing Harding v. Rosoff, 951 So. 2d 912 (Fla. 4th DCA 2007)), a surcharge is a “charge against a fiduciary to compensate a beneficiary for the breach of fiduciary duty.” The surcharge is imposed personally on the trustee — not against trust assets — so trust beneficiaries don’t bear the cost of the trustee’s misconduct. Surcharge can be sought for losses caused by breach, profits made from breach, or both.
Frequent breaches we see in Florida trust litigation: (1) Self-dealing — trustee buys trust property at below-market price or sells to a controlled entity; (2) Comingling — mixing trust funds with personal or business accounts; (3) Excessive trustee fees — charging fees disproportionate to the work or trust size; (4) Imprudent investment — concentrated positions, speculative trading, failure to diversify; (5) Failure to account — refusing or providing incomplete annual accountings; (6) Favoring one beneficiary — income beneficiaries vs. remaindermen, or family branch favoritism; (7) Delay or refusal to distribute when distributions are required; (8) Failure to pursue claims on behalf of the trust.
Florida law provides several measures of damages: (1) Direct loss — the dollar amount the trust lost because of the breach (e.g., difference between fair market value and self-dealing sale price); (2) Profits the trustee made from the breach (disgorgement); (3) Interest on the lost amount; (4) Removal of the trustee (Fla. Stat. § 736.0706); (5) Reduction or denial of trustee compensation; (6) Attorney’s fees and costs under Fla. Stat. § 736.1004; (7) In egregious cases, punitive damages if the conduct involves intentional misconduct or fraud.
Florida’s strong fee-shifting statute, Fla. Stat. § 736.1004, authorizes attorney’s fees in all trust actions arising under Chapter 736 and “in all actions for breach of fiduciary duty or challenging the exercise of, or failure to exercise, a trustee’s powers.” The court has broad discretion to award fees against the trustee personally (not the trust), against the trust, or in favor of either party. The leading appellate decision is Levine v. Stimmel, 272 So. 3d 847 (Fla. 5th DCA 2019). The party seeking fees has an affirmative burden to demonstrate the time spent on fee-authorized claims.
Yes. A trustee is sued in their personal capacity for breach of fiduciary duty — the goal is personal liability that comes out of the trustee’s personal assets, not from the trust. The complaint typically names the trustee “individually” as well as in their capacity as trustee. If the breach involves a co-trustee, both can be named. Some trustees seek indemnification from the trust for defense costs, but indemnification is generally barred when the trustee is found to have committed breach in bad faith or with reckless indifference.
Florida’s general 4-year statute of limitations for breach of fiduciary duty applies (Fla. Stat. § 95.11(3)). However, under Fla. Stat. § 736.1008, if the trustee provides an accounting that adequately discloses the breach AND provides a “limitation notice,” the limitations period shortens to 6 months from the date of the disclosure. Without proper notice and disclosure, the limitations period does not run. The Fourth DCA in Woodward v. Woodward, 192 So. 3d 528 (Fla. 4th DCA 2016), held the limitations period began when the trustee provided the 2011 accounting — not from the earlier underlying transactions.
Strong breach claims typically rest on: (1) The trust instrument itself — the specific duties the trustee accepted; (2) Annual accountings — line-item evidence of trustee activity; (3) Bank and brokerage records — actual transactions vs. what the accountings show; (4) Tax returns — trust 1041s and beneficiary K-1s; (5) Forensic accounting expert — to identify discrepancies, valuation issues, and self-dealing; (6) Trustee’s correspondence with beneficiaries — to show pattern of non-disclosure; (7) Discovery of comparable transactions — to show below-market self-dealing sales. Most strong cases come down to documentary proof plus a competent forensic accountant.
Case citations verified against CourtListener. This page is general information about Florida trust litigation and is not legal advice for your situation.
See the complete Florida trust litigation guide — accounting demands, surcharge actions, removal, and remedies.
Managing Attorney, Zoecklein Law, P.A. · Florida Bar No. 0085615 · Trust Litigation, Estate Planning, Probate