Nebraska Advance She

IN RE ESTATE OF STUCHLIK 673

Cite as 289 Neb. 673

In re Estate of Edward J. Stuchlik, Jr., deceased a

Trust Created by Edward J. Stuchlik, Jr., decea

John E. Stuchlik, appellant, v. Margaret Stuc

Personal Representative and Cotrust

Kenneth Stuchlik, Cotrustee, appel

___ N.W.2d ___

Filed December 12, 2014. No. S-13-1118.

1. Decedents’ Estates: Appeal and Error. In reviewing a judgment of the probate 

court in a law action, the Supreme Court does not reweigh evidence, but considers evidence in the light most favorable to the successful party and resolves 

evidentiary conflicts in favor of the successful party, who is entitled to every 

reasonable inference deducible from the evidence.

2. ____: ____. The probate court’s factual findings have the effect of a verdict, 

and an appellate court cannot set those findings aside unless they are clearly 

erroneous.

3. Judgments: Appeal and Error. On a question of law, an appellate court is 

obligated to reach a conclusion independent of the determination reached by the 

court below.

4. Fraud: Judgments. The existence of a fiduciary duty and the scope of that duty 

are questions of law for a court to decide.

5. Wills: Contracts. Oral testimony as to a contract for wills is allowed only where 

the will itself references the contract.

6. Decedents’ Estates: Wills: Contracts: Breach of Contract. The effect of a valid 

contract for wills is not to create a cause of action against the decedent’s estate, 

but instead is to create a cause of action for breach of contract.

7. Wills: Contracts. Even where a valid contractual will exists, that existence does 

not make the surviving party’s will irrevocable.

8. Decedents’ Estates: Wills: Contracts: Breach of Contract. If a surviving party 

revokes or breaches a mutual contractual will, an action lies for a breach of contract against the estate of the survivor.

9. Decedents’ Estates: Jurisdiction. County courts have exclusive jurisdiction over 

all matters relating to decedents’ estates, including the probate of wills and construction thereof.

10. Decedents’ Estates: Jurisdiction: Equity. In exercising exclusive original jurisdiction over estates, county courts may apply equitable principles to matters 

within probate jurisdiction.

11. Decedents’ Estates: Jurisdiction: Wills: Trusts: Minors: Mental Competency. 

County courts have jurisdiction over all subject matter relating to estates of decedents, including construction of wills and determination of heirs and successors 

of decedents, estates of protected persons, protection of minors and incapacitated 

persons, and trusts.

12. Courts: Jurisdiction. County courts have full power to make orders, judgments, 

and decrees and to take all other actions necessary and proper to administer justice in the matters which come before them.
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13. Trusts: Property. A trust creates a fiduciary relationship in which one person 

holds a property interest subject to an equitable obligation to keep or use that 

interest for the benefit of another.

14. Trusts. Trustees owe the beneficiaries of a trust duties that include loyalty, 

impartiality, prudent administration, protection of trust property, proper recordkeeping, and informing and reporting.

15. ____. The duty of loyalty requires a trustee to administer the trust solely in the 

interests of the beneficiaries.

16. ____. In exercising powers of control over interests in an enterprise held by a 

trust, a trustee shall act in the best interests of the trust beneficiaries.

17. ____. If a trust has two or more or more beneficiaries, a trustee has a duty of 

impartiality among beneficiaries.

18. Trusts: Words and Phrases. Impartiality means that a trustee’s treatment of 

beneficiaries or conduct in administering a trust is not to be influenced by the 

trustee’s personal favoritism or animosity toward individual beneficiaries.

19. Trusts: Conflict of Interest. A cause for removal is appropriate for the best 

interests of the trust estate where hostile relations exist between a trustee and 

beneficiaries of such a nature as to interfere with proper execution of the trust, 

particularly where it appears that the trustee’s personal interests conflict with, or 

are antagonistic to, his or her duties as trustee under the terms of the trust.

20. ____: ____. When an entity is held by a trust, and particularly where a controlling share of that entity is exercised against the best interests of any trust beneficiary, it is a breach of the duty of loyalty.

21. Trusts: Attorney Fees: Costs. Attorney fees and expenses will ordinarily be 

allowed to a trustee where they were incurred for the benefit of the estate.

22. ____: ____: ____. If a fiduciary’s defense of his or her acts if fully successful, he 

or she is entitled to recover the reasonable costs necessarily incurred in preparing 

his or her final account and in successfully defending it against objections.

23. ____: ____: ____. A fiduciary’s defense must be only substantially successful, 

not 100 percent successful, in order for the fiduciary to be entitled to recover 

costs and attorney fees.

24. Courts: Trusts: Attorney Fees: Costs: Appeal and Error. The county court 

or district court on appeal has discretionary power and authority to order payment out of the trust estate for costs of litigation and, in proper cases, to order 

payment of reasonable fees to attorneys for services rendered to a trustee in 

good faith.

Appeal from the County Court for Saunders County: Patric

R. McDermott, Judge. Affirmed in part, and in part revers

and remanded for further proceedings.

Paul R. Elofson, of Fitzgerald, Schorr, Barmettler & Brennan, 

P.C., L.L.O., for appellant.

Richard L. Rice and Andrew C. Pease, of Crosby Guenzel, 

L.L.P., for appellees.
Nebraska Advance She

IN RE ESTATE OF STUCHLIK 675

Cite as 289 Neb. 673

Heavican, C.J., Wright, Connolly, Stephan, 

Miller-Lerman, and Cassel,

McCormack, 

I. NATURE OF CASE

This matter involves petitions filed by John E. Stuchlik 

seeking removal of the personal representative of the Edward J. 

Stuchlik, Jr., estate and removal of the cotrustees of the Edward 

J. Stuchlik, Jr., Family Trust. The personal representative and 

one of the cotrustees is John’s mother and the spouse of the 

decedent. The other cotrustee is John’s brother. The probate 

dispute involves assets held in a testamentary trust established 

by the last will and testament of the decedent.

II. BACKGROUND

On March 22, 2012, Edward J. Stuchlik, Jr. (Stuchlik), died 

testate. He was survived by his wife, Margaret L. Stuchlik, 

and his five children, John, Edward J. Stuchlik II, LeAnne 

M. Bullock, Linda M. Voboril, and Kenneth G. Stuchlik. This 

action is by John against Margaret as both personal representative and cotrustee and Kenneth as cotrustee. John filed a petition in the probate proceedings to remove Margaret as personal 

representative. John also asked for trust administration and to 

have Margaret and Kenneth removed as cotrustees. Among 

other things, John alleged that Margaret was managing trust 

assets against the will of Stuchlik and harming John’s interests 

as a beneficiary. John asked the court to appoint him as personal representative and trustee in their place.

1. Real Estate 

Partnersh

Before Stuchlik’s death, Stuchlik and Margaret formed a 

limited partnership in the name of Stuchlik Farms Ltd. in the 

course of their tax and estate planning. They conveyed into the 

partnership all of the farm real estate that they owned.

Originally, Stuchlik and Margaret were the general partners 

and owners of 100 percent of the general partnership interests. 

Eventually, Stuchlik and Margaret gifted equal limited partnership interests to John, Edward, and Kenneth. Currently, the 

partnership is owned 22.1888 percent by John as a limited 
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partner. Edward and Kenneth each also own a 22.1888-percent 

limited partnership interest in his own name. Margaret holds 

a 16.7168-percent limited partnership interest and a 1-percent 

general partnership interest in her own name. Margaret and 

Kenneth hold a 16.7168-percent interest as cotrustees of the 

family trust, including the 1-percent general partnership interest originally held by Stuchlik. The farm real estate is the only 

asset held by the partnership.

2. Stuchlik Family 

Family Tru

Stuchlik left a will executed on February 8, 2011. Stuchlik’s 

will provided that, aside from certain personal items that were 

bequeathed to Margaret, all assets were to be transferred to the 

family trust. The terms of the trust stated that the income and 

assets were to be expended as needed to support Margaret during her lifetime and that, upon her death, the assets were to be 

distributed according to certain provisions.

The provisions of the trust are set forth in the fifth article of 

Stuchlik’s will. The terms state:

Upon the death of my spouse . . . the trustee shall distribute all of my estate and trust estate as follows:

1) [personal property items to be designated according 

to safe deposit box list].

2) . . . trucks, pickups or machinery and grain shall be 

sold and the proceeds thereof divided equally to [Kenneth, 

John, and Edward], share and share alike.

3) I acknowledge that a portion or all of my farm real 

estate may be titled in Stuchlik Farms, Ltd. . . . but it is 

my desire and request that my sons as a condition of their 

inheritance, exchange deeds so as to divide my farm real 

estate [such that each of the sons would receive a specified parcel or parcels of farm real estate.]

. . . .

(h) I devise all the rest, residue and remainder of my 

estate and trust estate to [Kenneth, John, and Edward], 

share and share alike.

The parcel specifically set aside for John included the “home 

place.” John and his family have lived at the home place 
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IN RE ESTATE OF STUCHLIK 677

Cite as 289 Neb. 673

sporadically for over 20 years, with some absences while John 

was working out of state.

Margaret was named as personal representative of the estate, 

and Margaret and Kenneth were named cotrustees of the family trust.

Margaret stated in an affidavit to the court that all estate 

assets were moved into the family trust, and this evidence was 

corroborated by her attorney at oral argument. Thus, the estate 

is ready to be closed.

3. Alleged Contract 

Wills or Oral Tr

John argues that there was either a contract for wills or an 

oral trust between Margaret and Stuchlik. He asserts as evidence the language of the will indicating Stuchlik’s “desire 

and request that my sons[,] as a condition of their inheritance, exchange deeds so as to divide my farm real estate 

as follows.”

As further evidence of the contract for wills or an oral trust, 

John produced a document handwritten by Margaret to the 

couple’s attorney, Curtis Bromm. The letter states that “[i]n 

case of our death Dad & I want the land and our possessions 

divided this way,” and it then devises part of their land to John. 

The letter was signed by both Margaret and Stuchlik on March 

1, 2009.

At a deposition on July 15, 2013, Margaret engaged in the 

following dialog with counsel:

[Q:] Did you and [Stuchlik] sit down and talk about 

how . . . you’re going to make distribution of your estate?

[A]: It’s in the will.

[Q:] And you discussed it, and then you — either with 

. . . Bromm or in his presence and discussed that issue or 

with — you went to . . . Bromm and told him what you 

wanted to do; is that correct?

[A]: That’s what [Stuchlik] did.

[Q]: All right. And were you present?

[A]: I was present.

[Q:] And so . . . Bromm drafted a will consistent with 

your husband’s wishes and understandings, and he drafted 
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a will that was consistent with your wishes and understandings. And those two wills, based upon what you’ve 

shared with me, were based upon an agreement between 

you and [Stuchlik] about how your joint assets would be 

conveyed; is that correct?

[A]: Yes.

. . . .

[Q:] So do I understand that your will and [Stuchlik’s] 

will as of February 2011 were identical in terms of how 

they transferred property?

[A]: Explain “identical.”

[Q:] Other than the name changes, the dispositive provisions about how property was to be dissolved, distributed, they were identical in format; is that correct?

[A]: Yes.

Margaret later testified at trial that she did not make any 

contract for wills with Stuchlik.

At trial, Bromm was also called as a witness. The court 

allowed John’s counsel to inquire into the making of Stuchlik’s 

will, but only to the extent that Bromm felt he was within his 

ethical boundaries. The court stated, “I think it’s going to 

have to be done kind of question by question because some 

questions may not be ones that I would feel interfere with 

the attorney-client privilege with [Margaret] and there will be 

some that may very directly bear on her privilege with . . . 

Bromm.” Eventually, John’s counsel asked the court to review 

Bromm’s file on the Stuchliks. The court declined to review 

the case file in camera. The court allowed in evidence only 

the letter from Margaret and Stuchlik containing directives for 

their will.

4. Activities of Cotruste

After Stuchlik’s death, Margaret conveyed the home place 

owned by the partnership to Edward, Voboril, and Kenneth as 

tenants in common, subject to a life estate granted to Margaret. 

As the warranty deed states, “[Margaret], a single person, 

Grantor, in consideration of One Dollar ($1.00) and other good 

and valuable consideration, conveys to Grantees, [Edward, 

Voboril, and Kenneth], as tenants-in-common, an undivided 
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IN RE ESTATE OF STUCHLIK 679

Cite as 289 Neb. 673

one-half interest in and to the following described real estate . . 

. .” The warranty deed then purports to convey the home place 

from Margaret to Edward, Voboril, and Kenneth.

In January 2013, Margaret, Kenneth, and Edward entered 

the home place premises without the consent of John. They 

were accompanied by a county sheriff’s deputy who testified 

that he did so “through a civil standby that [he] was requested 

to do sometime at the beginning of this year.” The county 

sheriff’s deputy testified that he was directed by the sheriff 

to accompany Margaret and her two children “to make sure 

that there’s no sort of altercation between the two parties.” 

Margaret, Kenneth, and Edward entered the residence and 

changed the locks. A propane tank was removed from the 

home place residence, which caused the home to go without 

heat for several days and subsequently caused damage from 

frozen pipes. Since the retaking of the home place, Margaret, 

Kenneth, and Edward have indicated to John that they intend 

to demolish the residence. John alleges that Margaret’s and 

Kenneth’s treatment of his personal property in the residence 

constituted a conversion.

It is alleged that the partnership entered into leases with 

members of the family that were below fair market value. John 

alleges the leases are below fair market value because they 

are 10-year crop share leases, and he believes Margaret’s life 

expectancy is less than 10 years. Therefore, it would result in 

John’s share being burdened by the lease. However, the evidentiary rulings of the county court limited the record in regard to 

these allegations.

5. County Court Procee

In this action, John filed a petition in the probate proceedings to remove Margaret as a personal representative. John 

also asked for trust administration and to have Margaret 

and Kenneth removed as cotrustees. John asked the court 

to appoint him as personal representative and trustee in 

their place.

The matters were heard in August 2013, and on September 

13, the county court entered an order on John’s petitions. 

The court stated that there were three main issues it needed 
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to resolve: (1) the extent of its jurisdiction in this matter; (2) 

whether there was a contract for wills between Margaret and 

Edward and, if so, whether it had any bearing on this proceeding; and (3) whether the actions of which John complained 

were taken by Margaret and/or Kenneth in their capacities as 

personal representative and cotrustees.

(a) County Court Jurisdiction

The court concluded that its jurisdiction extended only to 

matters related to the property of the estate and to the corpus 

of the family trust and that any claim related to the operation 

and assets of the limited partnership (including all of the real 

estate involved) was outside of the court’s probate jurisdiction. The court emphasized that issues pertaining to the home 

place were related to the partnership, and not to Stuchlik’s 

estate, and that therefore, any claim relating to John’s ouster 

from the home place was outside of the county court’s limited jurisdiction.

The argument over the scope of the court’s jurisdiction in 

the matter led to discovery disputes between the two parties. 

Midway through the proceedings, the disputes led the court 

to issue an order limiting the scope of discovery to “discovery relevant to administration of the estate of the decedent 

and to property of the estate.” Even after the discovery 

order, John continued to solicit evidence along the lines of 

his broader view of the court’s jurisdiction. He was allowed 

several times to make offers of proof. The court ruled again 

during trial:

We are not going into any more about the partnership. 

I think the ouster of [John] was a partnership action. They 

removed him from partnership property. I can’t fix that as 

a probate judge. And I have — I’ve been ruling that way 

since the first protective order in discovery that I put out. 

And that’s my ruling. It’s not probate property.

(b) Existence of Contract 

for Wills

The court concluded that there was insufficient evidence 

of a contract for wills between Margaret and Stuchlik and, 
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IN RE ESTATE OF STUCHLIK 681

Cite as 289 Neb. 673

instead, found the estate plan consistent with a mutual will 

arrangement.

(c) Fiduciary Duties With Respect 

to Estate Property

The court found that actions taken by Margaret and Kenneth 

in their capacities as personal representative and cotrustees did 

not show evidence of mismanagement under the statutory definition. The court therefore dismissed John’s petition to remove 

Margaret as personal representative. With respect to the family 

trust, the court granted the request for trust administration, but 

only to the extent that the court granted registration of the family trust, and denied all other relief, including the request to 

remove the cotrustees.

(d) Posttrial Motions and Orders

John moved for a new trial at the end of the proceedings. 

Both parties moved for attorney fees. John’s motion for a new 

trial was denied. Margaret and Kenneth were awarded attorney fees.

III. ASSIGNMENTS OF ERROR

John’s assignments of error, consolidated and restated, are 

the following: (1) failing to find that a contract for wills 

existed between Margaret and Stuchlik; (2) failing to admit 

evidence and allow discovery which could have led the court to 

find that a contract for wills existed; (3) finding that the county 

court lacked jurisdiction over matters pertaining to the farm 

real estate held by the partnership, reasoning that Margaret’s 

activities as general partner had no bearing on her fitness as 

a personal representative and cotrustee of the family trust; (4) 

failing to find that Margaret’s and Kenneth’s activities warranted removal as personal representative and cotrustees; (5) 

failing to award John his attorney fees and costs, and awarding 

Margaret and Kenneth attorney fees to be paid from the estate; 

and (6) overruling John’s motion for a new trial.

IV. STANDARD OF REVIEW

[1,2] In reviewing a judgment of the probate court in a 

law action, the Supreme Court does not reweigh evidence, 
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but considers evidence in the light most favorable to the 

successful party and resolves evidentiary conflicts in favor 

of the successful party, who is entitled to every reasonable 

inference deducible from the evidence.1 The probate court’s 

factual findings have the effect of a verdict, and an appellate court cannot set those findings aside unless they are 

clearly erroneous.2

[3,4] However, on a question of law, an appellate court is 

obligated to reach a conclusion independent of the determination reached by the court below.3

 The existence of a fiduciary 

duty and the scope of that duty are questions of law for a court 

to decide.4

V. ANALYSIS

As will be explained in more detail below, we affirm in 

most respects, but reverse, and remand for the limited purpose 

of reviewing Margaret’s and Kenneth’s activities in regard to 

the partnership as evidence of any potential breach of fiduciary 

duties as cotrustees.

Margaret has already completed her duties as personal representative and is waiting to be discharged pending the result of 

this action. Therefore, any action for her removal as personal 

representative is without merit.

With regard to John’s petition to remove Margaret and 

Kenneth as cotrustees, much of John’s argument is based on a 

theory of a contract for wills or an oral trust between Margaret 

and Stuchlik. We find these arguments wholly irrelevant to the 

petition to remove a cotrustee. An action to remove cotrustees 

of a trust must center on any serious breaches by the cotrustees.5

 Therefore, the emphasis on the real estate and partnership 

property is misplaced.

1 See In re Estate of Lamplaugh, 270 Neb. 941, 708 N.W.2d 645 (2006).

2 See id.

3 Id.

4 Gonzalez v. Union Pacific RR. Co., 282 Neb. 47, 803 N.W.2d 424 (2011).

5 See Neb. Rev. Stat. § 30-3862 (Reissue 2008).
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IN RE ESTATE OF STUCHLIK 683

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However, to the extent Margaret’s and Kenneth’s activities 

as general partners of the partnership relate to their fitness as 

cotrustees, the court erred in concluding that it lacked jurisdiction to consider any evidence pertaining to those allegations. We remand the cause for a determination of whether 

the partnership activities related back to their fiduciary duties 

as cotrustees.

1. Removal as Perso

Representati

The county court was correct in its finding that Margaret 

had not breached any of her duties as personal representative, because her duties in that capacity were completed when 

the estate property was transferred into the family trust. All 

estate assets are now in the family trust. The estate’s closure 

is awaiting the end of this action. Accordingly, the only issue 

left is Margaret’s and Kenneth’s actions as cotrustees of the 

family trust.

2. Removal as Cotruste

Removal of a cotrustee is proper under § 30-3862 where 

(1) the trustee has committed a serious breach of trust; (2) 

the trustee fails to cooperate among fellow cotrustees; (3) the 

trustee is unfit, unwilling, or persistently fails to administer the 

trust effectively, and the court determines that removal would 

best serve the interests of the beneficiaries; and (4) there has 

been a substantial change in circumstances or removal is 

requested by all of the qualified beneficiaries and the court 

finds removal would best serve these interests. John alleges 

that Margaret should be removed as cotrustee for failing to 

abide by a contract for wills or an oral trust between herself 

and Stuchlik. This cannot be the case, because a failure to 

abide by a contract for wills or an oral trust is not a basis for 

removing a cotrustee under this removal statute. However, 

evidence of Margaret’s and Kenneth’s activities as general 

partners of the partnership may be relevant to determine 

whether there is a basis for their removal as cotrustees under 

this statute.
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(a) Contract for Wills 

or Oral Trust

(i) Contract for Wills

The county court was correct in finding that there was not 

enough evidence to support a contract for wills and that even 

if there was, such a contract was not relevant to this action. 

John argues that Margaret had entered into a contract for wills 

with Stuchlik before his death and that the two had contracted 

to equally divide the trust between their three sons. However, 

there is no evidence of such a contract. Further, the proper 

case for a breach of a contract for wills is not a probate action 

against the decedent’s estate, but, rather, is an action for breach 

of contract or an action against the breaching party’s estate. 

Therefore, a contract for wills is wholly irrelevant to this action 

to remove cotrustees.

[5] In Nebraska, a contract for wills “can be established 

only by (1) provisions of a will stating material provisions of 

the contract; (2) an express reference in a will to a contract 

and extrinsic evidence proving the terms of the contract; or 

(3) a writing signed by the decedent evidencing the contract.”6

“The execution of a joint will or mutual wills does not create 

a presumption of a contract not to revoke the will or wills.”7

The comments to the Uniform Trust Code, as adopted by 

Nebraska, allow oral testimony only if the will references 

the contract.8

The county court found that the evidence of a letter from 

Margaret and Stuchlik directing Bromm on the division of the 

estate was merely the evidence of an intent to have mutual 

wills, and not an agreement to will. The court correctly found 

that the language in the will did not raise a presumption of a 

contract for wills. We agree.

[6-8] Even if such a contract for wills existed, the proper 

action for enforcement would not be a probate action for 

removal of a cotrustee. The effect of a valid contract for wills 

6 Neb. Rev. Stat. § 30-2351 (Reissue 2008).

7 Id. (emphasis supplied).

8 See Johnson v. Anderson, 278 Neb. 500, 771 N.W.2d 565 (2009).
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is not to create a cause of action against the decedent’s estate, 

but instead is to create a cause of action for breach of contract.9

In Pruss v. Pruss,

10 beneficiaries filed an action seeking relief 

that would compel the distribution of a wife’s estate under the 

terms of a mutual contractual will, rather than under a subsequent will executed after the death of the husband. There, 

we held that even where a valid contractual will existed, that 

existence did not make a will irrevocable. Wills by their nature 

are ambulatory and may be revoked at any time.11 Instead, 

if the surviving spouse revokes or breaches the mutual contractual will, an action may lie for breach of contract against 

the estate of the survivor.

12 Therefore, in the present case, 

the cause of action was improperly brought as an action for 

the removal of the personal representative and cotrustees, 

and instead should have been brought as a breach of contract 

action against Margaret, as the surviving spouse, by the supposed beneficiaries.

(ii) Oral Trust

John asks this court to find, as an alternative to the contract 

for wills, that an oral trust had been established through the 

evidence at trial. Neb. Rev. Stat. § 30-3833 (Reissue 2008) 

states that “a trust need not be evidenced by a trust instrument, 

but the creation of an oral trust and its terms . . . may be established only by clear and convincing evidence.”

The county court found that there was no evidence of such 

an oral trust. Given our standard of review in these proceedings, we must give weight to the court’s evidentiary findings. 

We do not reweigh evidence, but consider evidence in the light 

most favorable to the successful party and resolve evidentiary 

conflicts in favor of the successful party.13 We find no clear 

error in the county court’s finding.

9 Pruss v. Pruss, 245 Neb. 521, 514 N.W.2d 335 (1994).

10 Id. 11 See id.

12 See id.

13 In re Estate of Lamplaugh, supra note 1.
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Because we find that the county court was correct in finding that there was no contract for wills or an oral trust, and 

because an existence of such a contract would be irrelevant to 

the removal of a trustee, we find no merit to John’s arguments 

that the court erred in not allowing discovery on the matter, 

erred in granting attorney-client privilege, or erred in failing to 

review Bromm’s testimony in camera for relevancy.

(b) Jurisdiction Over 

Partnership Actions

Finally, John asserts that the court erred in failing to find 

that Margaret’s conduct as a general partner warranted her 

removal as cotrustee. The county court concluded that it could 

not base Margaret’s removal on any conduct pertaining to the 

partnership. The court reasoned that it lacked jurisdiction over 

matters to do with the partnership and the real estate held by 

the partnership. However, 16.7168 percent of the partnership, 

including a 1-percent general partnership interest, is held 

in the family trust. To the extent that the cotrustees’ activities toward this partnership are relevant to their fitness as 

cotrustees, the court erred in concluding it lacked jurisdiction. 

Therefore, the court erred in denying discovery and in refusing to consider whether partnership actions reflected on the 

propriety of Margaret and Kenneth as cotrustees of the family trust.

[9-12] Neb. Rev. Stat. § 24-517(1) (Cum. Supp. 2012) states 

that the county court shall have exclusive jurisdiction over all 

matters relating to decedents’ estates, including the probate of 

wills and construction thereof. In exercising exclusive original 

jurisdiction over estates, county courts may apply equitable 

principles to matters within probate jurisdiction.14 We have 

held that county courts have jurisdiction over all subject matter 

relating to estates of decedents, including construction of wills 

and determination of heirs and successors of decedents, estates 

of protected persons, protection of minors and incapacitated 

persons, and trusts.

15 Such courts have full power to make 

14 Neb. Rev. Stat. § 30-2211 (Cum. Supp. 2014).

15 See, id.; In re Estate of Layton, 207 Neb. 646, 300 N.W.2d 802 (1981).
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orders, judgments, and decrees and to take all other actions 

necessary and proper to administer justice in the matters which 

come before them.16

The county court here reasoned that “[m]erely because the 

matter raised relates in some manner to an estate or a trust 

does not turn the county court into a court of general equitable 

jurisdiction as [the partnership] is the exclusively [sic] purview 

of the district court.” The court was correct to decline adjudication of partnership disputes. A probate action is not the proper 

forum for resolving issues concerning any possible conversion 

or disputes regarding the real estate. But, John is asking for 

Margaret and Kenneth to be removed as cotrustees of the family trust due to a breach of their fiduciary duties. That trust 

holds over 16 percent of the partnership, as well as a general 

partnership interest. The 1-percent general partnership interest 

held by the family trust, with Margaret and Kenneth as cotrustees, combined with Margaret’s personal 1-percent general partnership interest, effectively gives Margaret 100 percent of the 

general partnership power.

Assuming John’s allegations are true, under Nebraska’s 

common definitions of a trustee’s fiduciary duties, Margaret 

and Kenneth may have breached fiduciary duties to John as 

a beneficiary of the trust through their management of the 

partnership. In particular, John argues that the cotrustees are 

engaged in self-dealing, actions of personal animus and friction that interfered with the proper administration of the estate 

and trust, and failing to abide by the terms of the trust. If 

so, actions taken with regard to the real estate (held by the 

partnership) may be relevant evidence of a breach of fiduciary duties.

[13,14] A trust creates a fiduciary relationship in which one 

person holds a property interest subject to an equitable obligation to keep or use that interest for the benefit of another.17 A 

trustee has the duty to “administer the trust in good faith, in 

accordance with its terms and purposes and the interests of the 

beneficiaries, and in accordance with the Nebraska Uniform 

16 Id.

17 Karpf v. Karpf, 240 Neb. 302, 481 N.W.2d 891 (1992).
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Trust Code.”18 The Nebraska Uniform Trust Code, in turn, 

states that trustees owe the beneficiaries of a trust duties that 

include loyalty, impartiality, prudent administration, protection of trust property, proper recordkeeping, and informing 

and reporting.19

[15,16] The duty of loyalty requires a trustee to administer the trust solely in the interests of the beneficiaries.20 As 

§ 30-3867(c) states, “A sale, encumbrance, or other transaction 

involving the investment or management of trust property is 

presumed to be affected by a conflict between personal and 

fiduciary interests if it is entered into by the trustee with . . . (2) 

the trustee’s descendants, siblings, parents, or their spouses.” 

Further, the statute states, “A transaction not concerning trust 

property in which the trustee engages in the trustee’s individual 

capacity involves a conflict between personal and fiduciary 

interests if the transaction concerns an opportunity properly 

belonging to the trust.”21 Particularly pertinent is the following 

section of the duty of loyalty statute:

In voting shares of stock or in exercising powers of 

control over similar interests in other forms of enterprise, the trustee shall act in the best interests of the 

beneficiaries. If the trust is the sole owner of a corporation or other form of enterprise, the trustee shall elect 

or appoint directors or other managers who will manage 

the corporation or enterprise in the best interests of the 

beneficiaries.22

Nebraska’s statutes are derived from the Restatement (Third) 

of Trusts.23 The comments in the Restatement state that the 

policy behind this law is to prevent trustees’ placing themselves in positions in which they may be tempted to act for 

18 Neb. Rev. Stat. § 30-3866 (Reissue 2008).

19 See Neb. Rev. Stat. §§ 30-3866 through 30-3870 (Reissue 2008). See, 

also, In re Estate of Robb, 21 Neb. App. 429, 839 N.W.2d 368 (2013).

20 § 30-3867(a).

21 § 30-3867(d).

22 § 30-3867(f) (emphasis supplied).

23 Restatement (Third) of Trusts (2007).
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reasons other than the best interests of the beneficiaries.24 “This 

policy of strict prohibition also provides a reasonable circumstantial assurance . . . that beneficiaries will not be deprived of 

a trustee’s disinterested and objective judgment.”25

[17-19] If a trust has two or more beneficiaries, a trustee 

has a duty of impartiality among beneficiaries.26 This includes 

a duty to “act impartially in investing, managing, and distributing the trust property, giving due regard to the beneficiaries’ 

respective interests.”27 Comments in the Restatement suggest 

that the duty of impartiality includes a duty to conform to the 

settlor’s intentions and the terms of the trust instrument.

It is not only appropriate but required by the duty of 

impartiality that a trustee’s treatment of beneficiaries, and 

the balancing of their competing interests, reasonably 

reflect any preferences and priorities that are discernible from the terms . . . , purposes, and circumstances of 

the trust and from the nature and terms of the beneficial 

interests. Thus, unfortunately, it is often the case that 

the implications of the duty of impartiality are complicated by the difficulties of determining, and the vagueness of, some relevant aspects of the settlor’s intentions 

and objectives—much of which is left to interpretation 

and inference.28

Impartiality means that a trustee’s treatment of beneficiaries or 

conduct in administering a trust is not to be influenced by the 

trustee’s personal favoritism or animosity toward individual 

beneficiaries.29 As we have held:

“A court of equity has power and authority to remove 

a trustee from his office, when any substantial personal 

disability exists in the trustee, when he fails to perform 

the duties of his position, when he has misconducted 

24 See id., § 78.

25 Id., comment b. at 96.

26 § 30-3868.

27 Id.

28 Restatement, supra note 23, § 79 at 129 (emphasis supplied).

29 Id.
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himself in office, when hostile relations exist between the 

trustee and his beneficiaries of such a nature as to interfere with the proper execution of the trust, or under any 

other conditions which render his removal necessary for 

the best interests of the trust estate, particularly where it 

appears that the trustee’s personal interests conflict with, 

or are antagonistic to, his duties as trustee under the 

terms of his trust.”30

[20] Nebraska law states that when an entity is held by a 

trust, and particularly where a controlling share of that entity 

is exercised against the best interests of any trust beneficiary, 

it is a breach of the duty of loyalty.31 That is exactly what is 

purported to have happened in this case. Margaret and Kenneth 

control the partnership through the general partnership interest 

held in the family trust. The partnership interest is the largest 

holding of the family trust. Though Margaret has a lifetime 

interest, her children have equal interests in the remainder. John 

alleges that the cotrustees are acting adversely to his interests 

as a beneficiary. He alleges that through Margaret’s actions as 

a general partner, she has caused assets of the partnership to 

be sold or leased at below market value, presumably causing 

the partnership interest held by the family trust to decrease in 

value. We do not know if these allegations have any truth, but 

the court had jurisdiction to consider these allegations and any 

evidence relevant thereto. It is conceivable that an examination 

into the actions of the partnership may have revealed evidence 

that Margaret and Kenneth were violating their duty of loyalty 

and against self-dealing.

Further, Nebraska law states that a trustee must act impartially between two or more beneficiaries.32 It violates a trustee’s duty of impartiality to administer a trust with personal 

favoritism or animosity toward a beneficiary.33 Through the 

general partnership held in trust, Margaret and Kenneth have 

30 Reed v. Ringsby, 156 Neb. 33, 39-40, 54 N.W.2d 318, 322 (1952) 

(emphasis supplied). See, also, § 30-3862.

31 § 30-3867(f).

32 § 30-3868.

33 Restatement, supra note 23, § 79.
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a management interest in the partnership. It is arguable that 

they may have managed the partnership in such a way as to 

treat John’s interest in the trust unfairly. Since Margaret and 

Kenneth have shown John disfavor, it may be relevant to 

examine the actions of the partnership in order to determine if 

the cotrustees intended to treat John unfairly in regard to his 

beneficial trust interest. The actions of Margaret and Kenneth 

in their capacities as partners may be evidence as to a breach 

of the duty of impartiality.

In sum, the county court was correct that it is not a proper 

forum for a partnership action. Most of the issues in this action 

pertain to the real estate held by the partnership, and for resolution of any of those issues, the county court was correct to 

decline jurisdiction. However, the county court does have jurisdiction over testamentary trusts and, in this case, the family 

trust. All parties must bear in mind that any evidence regarding the partnership must pertain to the cause for removal of a 

cotrustee and any breach of fiduciary duties by Margaret and 

Kenneth, in their capacities as cotrustees, not in their capacities as general partners. The county court may find that much 

evidence regarding partnership disputes is not relevant to the 

action for removal of the cotrustees.

(c) Attorney Fees

[21-24] Finally, we address the issue of attorney fees. 

Attorney fees and expenses will ordinarily be allowed to a 

trustee where they were incurred for the benefit of the estate.34

We have stated that to make a trustee personally responsible 

for all reasonably incurred attorney fees for the successful 

defense of his or her actions as a fiduciary would impose an 

unconscionable burden on fiduciary service without justification.35 And, if the fiduciary’s defense of his or her acts is 

fully successful, he or she is entitled to recover the reasonable 

costs necessarily incurred in preparing his or her final account 

and in successfully defending it against objections.36 We have 

34 Rapp v. Rapp, 252 Neb. 341, 562 N.W.2d 359 (1997).

35 Id.

36 See id.
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stated that the standard is “substantially successful” and that 

the fiduciary’s defense does not have to be 100 percent successful in order for the fiduciary to be entitled to recover costs 

including attorney fees.37 Similarly, the county court or district 

court on appeal has discretionary power and authority to order 

payment out of the trust estate for costs of litigation and, in 

proper cases, to order payment of reasonable fees to attorneys 

for services rendered to a trustee in good faith.38

Pending the county court’s determinations on remand, we 

leave the issue of attorney fees to be decided pursuant to 

these rules.

VI. CONCLUSION

For the foregoing reasons, we find that a contract for wills 

or an oral trust between Margaret and Stuchlik is irrelevant to 

an action to remove a personal representative or a cotrustee 

and that thus, any discovery or evidentiary objections are irrelevant to this ruling. We also find that removal of a personal 

representative is not proper in this case, because the personal 

representative properly transferred all estate assets into the 

family trust pursuant to the will, and that thus, all duties as 

personal representative have been completed. We affirm the 

rulings of the county court in these respects. We in part reverse 

the judgment and remand the cause to the county court in order 

to determine if any evidence of the cotrustees’ actions with 

regard to the partnership are relevant to their fiduciary duties 

as cotrustees, potentially warranting removal.

 Affirmed in part, and in part revers

remanded for further proceeding

37 Id. at 345, 562 N.W.2d at 362.

38 See id.