FOURTH D I VI SI ON

BA RNES, P. J.

, RA Y, and M CM I LLI A N

, JJ.

N O T IC E : M otions for r e c ons i de r a tion m us t be

ph y sic a l ly r e ce iv ed i n our c le r k ’s offic e w ithin te n

da y s of the da te of de c is ion to be de e m ed tim e ly file d.

http://w w w .ga a ppe a ls .us /r ule s /

Jul y 8, 2015



# I n th e Co u r t o f

A p p eals o f

G eo r g ia

A1 5 A0 20 2 . W E LLS FARGO BANK, N.A. v . COOK et al

.

A1 5 A0 20 3 . COOK et al . v . W ELLS FARGO BANK, N.A.

B A R N E S , Pres i d i n g J ud g e.

Th es e co m

p an i o n ap peal s cen t er o n t he ad m i n i s trat i o n of a ch ari t ab l e

rem ai n d er an n u i t y t ru s t (“ CRAT”) t h at was fo rm ed i n 2 00 0

. Th e t ru s t ee of t h e CRAT

was W el l s Farg o Ban k, N .A., 1 an d t he b en efi ci ari es were G ai l L

. Co o k an d Lan ce A.

Li p m an (co l l ect iv el y

, t h e “ p lai n t iffs ”). I n 2 0 1 1

, aft er t he co rp u s o f t h e tru s t was

ex h au s t ed

, t h e p l ai n t i ffs s u ed t h e b an k fo r breach of fi d u ci ary d u ty an d breach o f

co n tract

. Fo l lo wi n g di s co v ery

, t h e p lai n t i ffs m o v ed fo r part i al s u m m ary o n t h ei r

b reach o f co n t ract cl ai m

, an d t h e b an k m o v ed fo r s um m ary j u d gm en t o n b o t h o f t h e

p l ai n t i ffs ’ cl ai m s

. Th e t ri al co u rt d en i ed b o t h s u m m ary ju d g m en t m o ti o n s bu t g ran t ed

a cert i fi cat e o f i m

m ed i at e rev i ew. Fo ll o wi n g th e g ra n t o f t h e i r ap pl i cat i o n s fo r

1 W el l s Farg o i s t h e s u cces s o r i n i n t eres t t o W ach o v i a, th e o ri g in al tru s t ee. Fo r eas e

o f referen ce, we refer s i m p l y t o “ W el l s Farg o ” o r t h e “ b an k ” t h ro u g h o u t t hi s o p i n i o n

.i n t erl o cu t o ry ap p eal

, th e b an k an d t h e pl ai n t i ffs no w ch al len g e t h e t ri a l co urt ’ s

s u m m ary ju d g m en t ru l i n g s

.

Fo r t h e reas o n s d is cu s s ed b el o w

, w e c o n cl u de t h at t he p l ai n t i ffs ’ cl ai m s fo r

b reach o f fi d u ci ary d u t y t h at accru ed m o re t h an t wo y ears b efo re t h e fi l i n g o f t h e i r

l aws u i t are b arred b y t h e two -y ear s t at u t e o f l i m i t at i on im p o s ed b y t h e Rev i s ed

Geo rg i a Tru s t Co d e o f 2 0 1 0

, OCGA § 5 3 -1 2 -3 0 7 (a). W e co ncl u d e t h at p l ai n t i ffs ’

rem ai n i n g cl ai m s f

o r b reach o f fi d u ci ary d u t y fai l as a m at t er o f l aw b ecau s e t h e

p l ai n t i ffs d i d n o t co m e fo rward wi t h ev i d en ce t o s u pp o rt al l of t h e es s en t ial el em en t s

o f t h o s e cl ai m s

. Las t ly

, w e co n cl u d e t h at t h e p lai n ti ffs cl ai m fo r b reach o f co n t ract

i s precl u ded b y t he p l ai n l an g u ag e o f t h e part ies ’ s t ru s t ag reem en t

. Co n seq u en t l y

, we

rev er s e t h e tri al co u rt ’ s d en i al o f s u m m ary ju d g m en t t o W el l s Farg o in Cas e No

.

A1 5 A0 20 2

, an d we affi rm th e tri al co u rt ’ s d en ial of p art i al s u m m ary ju d g m en t t o t h e

p l ai n t i ffs i n Cas e No

. A1 5A0 2 0 3

.

Su m m ary ju d g m en t i s p ro p er i f t h e p l ead i n gs an d ev i d en ce “ sh o w t h at t h ere i s

n o gen u i n e i s s u e as to an y m at eri al fact an d t h at t h e m o v i n g p a r t y i s en t i t l ed t o a

ju d g m en t as a m at t er o f l aw.” OCGA § 9-1 1 -5 6 (c). O n ap p eal fro m t h e t ri al co urt ’ s

d en ial o f s u m

m ary ju d g m en t

, o u r rev i ew i s d e n o vo

, an d we co ns t ru e t h e ev i d en ce in

2t h e l i g h t m o s t fav orab l e to th e n o n m o v i n g p art y

. Tu cker F ed

. S & L As s n .v. Ba l o g h

,

2 2 8 Ga. Ap p . 4 8 2 (4 91 SE2 d 9 1 5 ) (1 9 9 7 ).

So v iewed

, t he reco rd refl ect s t h at t h e p lai n ti ffs are m arri ed

. Pl ai n ti ff Co o k h as

h er M as t ers of Bu s i n es s Ad m i n i s t rat i o n, i s a fo rm er cert i fi ed fi n an ci al p l an n er, an d

p rev i o u s l y o wn ed a fi n an ci al s erv i ces co m pan y

. Pl ai n t i ff Li p m an o wn s h i s o wn v i d eo

p ro d uct i o n co m

p an y

. Fro m 1 97 2 t o 1 9 9 9

, t he pl ai n t i ffs ob t ai n ed

, t h ro ug h a s eri es o f

g i ft s fro m Co o k ’ s u n cl e, s h ares o f st o ck i n An al o g Dev i ces

, In c., a pu b l i cl y t rad ed

d i g i t al an d co m

m un i cat io n s t ech n o l o g y

co m p an y

.

By 2 0 0 0

, t h e sh ares o f A n al o g s t o ck o wn ed b y t he p l ai n t iffs h ad a m ark et v al u e

o f o v er $ 1 ,9 0 0,0 0 0

. At t h at ti m e, Pl ai n ti ff Co o k w a s 4 7 ye ars o l d an d Pl ai n t i ff

Li p m an was 5 0 y ears o l d

. Becau s e t he p l ai n t i ffs were s m al l b u s i n es s o wn ers wi t h n o

co rp o rat e ret i rem en t p l an , t h ey d eci d ed t o u s e 1 2 ,0 0 0 s h ares o f t h e A n al o g s t o ck t o

fu n d t hei r fu t u re ret i rem en t

. Ho wev er, t h e p l ai n t i ffs h ad no tax b as i s i n t h e s t o ck

, an d

t h ey faced co n s i d erab l e cap i t al g ai n s t ax es if t h e s t o ck were s o l d o u t ri g h t b ecau s e i t

h ad ap p reci at ed g reat l y

o v er t h e y ears

.

In earl y 2 0 0 0

, aft er co ns u l t i n g wi th th ei r es t at e-p l an n in g at t orn ey

, t h e p l a i n t i ffs

d eci d ed t h at t h e fo rm at i o n o f a CRAT, wi t h t h e p l ai n t i ffs d es i gn at ed as t h e l i fet i m e

b en efi ci ari es o f t he t ru s t

, l i k el y wo ul d bes t serv e t h ei r ret i r e m en t g oal s w h i l e al s o

3p ro v id i n g t ax ben efi t s

. By us i ng a CRAT, t h e pl ai n t i f f s co u l d red u ce t hei r t ax ab l e

i n co m e b y recei v i n g a ch ari tab l e t ax d ed uct i o n ( v al u ed at t h e t i m e t h e tru s t was

creat ed ) an d b y d eferri n g cap i tal g ai n s t ax es

. 26 U .S.C. § 6 6 4 ( b )

, (c); 2 6 C.F.R. §

1 .6 64 -2 (d ).

Th e In t ern al Rev en ue Co d e an d rel at ed In t ern al Rev en u e Serv i ce (“ IRS”) ru l es

an d reg ul at i o ns go v ern wh et h er a t ru s t q u al i fi es as a CRAT u nd er fed eral t ax l aw. See

2 6 U.S.C. § 6 64 ( d ) ( 1 ) ; 26 C.F.R. § 1 .6 6 4 -2

. Un d er a CRAT, d o n ors can t ran s fer

as s et s i n t o a t ru s t an d t h en p ro v i d e fo r, am on g o t h er o p t io n s

, an an n u al d is tri b u t i o n

t o o ne o r m o re b en efi ci ari es fo r t h ei r l i fet i m e, wi t h t h e rem ai n d er of t h e t ru s t p ai d to

a q u al i fi ed ch ari t y u p on t h e b en efi ci ari es ’ deat h

. 2 6 U.S.C. § 6 6 4 (d ) (1 ). Th e an n u i t y

am ou n t pai d t o b en efi ci ari es m u s t b e i n a pred et erm in ed fi x ed s u m (cal cu lat ed o n t h e

d at e t h at t h e CRAT i s fu n d ed ), an d i t m us t b e n o l es s t h an 5 p ercen t an d n o g reat er

t h an 5 0 p ercen t of t h e i n i ti al fai r m ark et v al u e o f t h e t ru st

. 2 6 U.S.C. § 66 4 (d ) ( 1 )

(A).

Aft er co n su l t i n g wi t h t hei r es t at e p l an n i n g at t o rn e y

, the pla intif fs m et wi t h t h ei r

p ers o n al b an k er at W el l s Farg o

, wh o referred t h em t o t h e b an k ’ s t ru s t d ep art m en t

.

T h e p l a i n t i ffs

, th ei r es tat e-p l an n in g at t o rn ey

, an d b an k o ffi ci al s fro m t h e t ru s t

d ep art m en t t h en m et an d d i s cu s s ed t h e feas i b il i t y o f a CRAT as a ret i rem en t v eh i cl e

4fo r t h e p l ai nt i ffs

. T h e p art i es ag reed t h at th e 1 2,0 0 0 s h ares o f An al o g s t o ck wo u l d b e

t ran s ferred i nt o t h e t ru s t , aft er wh i ch t h e s t o ck wo u ld b e so l d at s o m e p o i n t an d t h e

p ro ceed s u s ed t o di v ers ify t h e t ru s t ’ s i n v es t m en t po rt fo l i o

. Th e p l ai n t iffs rei t erat ed

t h at t h ey wi s h ed t o recei v e a fi x ed an n u al d i s t ri bu t i o n as b en efi ci ari es o f th e tru s t t h at

wo u l d l as t fo r t hei r l i fet i m es wi t h o u t d ep l et i n g t he co rp u s o f t h e t ru s t

.

Th e p art i es ag re e d t h at t h e p l ai n t i ff’ s es t at e-p l an n i n g at t o rn ey wo u l d d raft a

t ru s t ag reem en t, an d W el l s Farg o w ou l d s u p p l y c a l cu l at i o ns s ug g es t i n g t h e

p ercen t ag e rat e fo r th e an n u al d i s t ri bu t i o n s t h at wo u l d b e p ai d t o t h e p l ai n t iffs as t h e

l i fet i m e b en efi ci ari es

. Su b s eq u en t l y

, W el l s Farg o p ro v id ed t h e r e que ste d c a lc ulat i on s

an d s u g g es t ed an an n u al fi x ed d i s t ri b u t i on t o t h e p lai n ti ffs o f 7 .5 p ercen t o f t h e i n i t i al

fai r m ark et v al u e o f t h e tru st

. Th e p l ai n ti ffs ag reed t o t h e an n ual d is tri b u t i o n

p ercen t ag e reco m

m en ded b y W el l s Farg o

, an d t h e t ru s t ag reem en t was d raft ed

acco rd i n g l y

.

On Feb ru ary 18

, 2 0 00

, t h e p l ai n t i ffs ex ecu t ed th e t ru s t ag reem en t u n d er wh i ch

W el l s Farg o was ap p o i n ted as t ru s t ee o f t h e CRAT i n t o wh i ch t h e 1 2 ,0 0 0 s h ares o f

An al o g s to ck wo u l d b e t ran sferred (t h e “ Tru s t ” o r “ Tru s t Ag reem en t ”). It em 2 (A) o f

t h e Tru s t Ag reem en t p ro v i d ed i n rel ev an t p art :

5Th e Tru s t ee s h al l in v es t an d rei nv es t t h e t ru s t p r o p ert y an d i n each

t ax ab l e y ear o f t h is t ru s t s h al l p ay

, i n eq u al q u art erl y i n s t al l m en t s

,

eq u al l y to [t h e p l ai n t iffs ]

, d u ri n g th ei r l i fet i m es

, an d aft er t h e d eat h o f

t h e fi rs t t o d i e o f t he t wo o f t h em

, t o t h e s u rv i v o r of t h em

, fo r su ch t i m e

as s u ch s u rv i v o r l i ves

, t h e “ an n u i t y am o u nt ” eq u al t o sev en an d o n e-h al f

p ercen t (7 .5 %) o f th e i n i ti al n et fai r m ark et v al ue o f t h e p ro p ert y p as s i n g

i n t o t h i s tru s t as fi n al l y d e t e r m i n ed fo r fed eral g ift t ax p u rp o s es

. T he

an n u i t y am ou n t s h al l b e p ai d fro m i n co m e an d

, t o t he ex t en t i n co m e i s

n o t s u ffi ci en t , fro m

p ri n ci p al

. . . .

Th e Tru s t Ag reem en t fu rt h er p ro v i d ed th at u p o n th e d eat h o f t h e s u rv i v i n g p l ai n t iff,

t h e ban k wo u l d p ay “ al l o f t h e t h en p ri n ci pal an d i n co m e o f t h i s t ru s t ” t o cert ai n

d es i g n at ed ch ari t ab l e b en efi ci ari es

.

On Feb ru ary 2 5

, 20 0 0

, t h e p l ai n t i f f s t r an sferred t h e 1 2

, 0 00 s h ares o f An al o g

s t ock i n t o t h e Tru s t. On t h e d a y o f t h e t ran s fer, t he 1 2,0 0 0 s hares o f s t o ck were

v al u ed at $ 1 ,9 0 4 ,2 5 0

. Bas ed u po n t h e s t o ck ’ s fai r m ark et v al u e o f $ 1 ,9 0 4 ,2 5 0 at t h e

t i m e o f t h e t ran s fer, t he 7

. 5 p ercen t an n u al d i s t ri b u t i on to t h e p l ai n t i ffs was fi x ed at

$ 1 4 2 ,8 1 8

.

On Feb ru ary 2 8

, 2 0 0 0

, W el l s Farg o s o l d al l o f t h e An al o g s t o ck an d u s ed t h e

p ro ceed s t o d i v ers i fy t he Tru s t ’ s in v es t m en t p o rt fo l io

. By t h at d at e, t h e v al u e o f t h e

s t ock h ad d ecreas ed t o $ 1,6 7 8,9 8 4

, a d ecl i ne o f $ 2 25 ,2 6 6 fro m t h e d ay o f t h e t ran s fer.

6W el l s Farg o i n v es t ed an d rei n v es t ed t h e p ro ceed s fro m th e s a l e o f s t o ck in

v ari o u s i n v es t m en t fu n d s o v er t h e n ex t s ev eral y ears an d p ai d t h e req u i red 7 .5 p ercen t

an n ual d i s t ri bu t i o ns o f $ 14 2 ,8 1 8 t o t h e p l ai n t i ffs

. Ho wev er, t h e an n ual ret u rn s o n t h e

i n v es t m en t s i n t he Tru st d i d n o t ex ceed t h e 7 .5 p ercen t an n u al d is t ri bu t i o n am o u n t

,

an d t h e co rp u s o f t h e Tru st decl i n ed i n v al u e ev ery y ear. Fro m M arch 2 0 0 0 t h ro u g h

Sep tem b er 2 0 1 1

, W el l s Farg o sen t t h e p l ai n t i ffs s t at em en t s o n a q uart erl y an d y earl y

(an d s o m et i m es m on t h l y ) b as i s t h at refl ect ed t h e ov eral l d ecl i n i n g v al u e o f t h e Tru s t

.

In M ay 2 0 0 2

, Pl ai nt i ff Co o k ex p res s ed her co n cern ab o ut t h e decl i n i n g v al u e

o f t h e T ru s t t o a W el l s Farg o i n v es t m en t m an ag er. Becau s e o f t h ei r co n t i n u ed

co n cern s o v er t h e m an ag em en t o f t h e Tru s t

, t he p l ai n t i ffs s u b s e q u e n tl y ret ai n ed an

at t o rn ey t o rep res en t t hem

i n t h e m at t er. In No vem

b er 2 0 0 3 , t h e p l ai n t iff’ s at t o rn ey

s en t a l et t er t o t h e W el l s Farg o sen i or v i ce p res i d en t of ch ari t ab l e s erv i ces ex p res s i n g

co n cern as t o wh et h er th e Tru s t wo u l d b e ab l e t o pay t h e pl ai n t i ffs $ 1 42 ,8 1 8 p er y ear

fo r t h ei r l i v es an d st i l l hav e a rem ai n d er t o d i s t ri b u t e to t h e d es i gn at e d c h ari t ab l e

b en efi ci ari es

. Th e at t o rn ey al s o as s ert ed t h at W el l s Farg o h ad as s um ed t h e o bl i g at i o n

o f en s u ri n g t h at t here was a s u ffi ci en t i n c o m e s t r e am fro m t h e Tru s t t o m ak e t h e

req u i red an n u al d i s t ri b u t i o ns t o t h e p l ai n t i ffs fo r l i fe. In Decem b er 2 0 0 3

, t h e v i ce

p res i den t wro t e b ack t o t h e p l ai n t i ffs an d t h ei r at t o rn ey

, as s u ri n g t h em t hat t h e b an k

7wo u l d co n t i n u e t o p r u d en t l y ex erci s e i t s fi d u ci ary d ut i es in m an ag i n g th e tru s t

, b ut

d e n yi ng th at t h e b an k h ad ev er p ro m i s ed t o g uaran t ee an an n ual d is tri b u t i o n t o t h e

p l ai n t i ffs fo r t h ei r l i v es ev en i f t h e co rp u s o f t h e Tru s t was ex h au s t ed

.

Th e p l ai nt i ffs an d t h ei r at t o rn ey m et wi t h t h e W el ls Farg o s en i o r v i ce p res i d en t

i n Ju n e 2 0 0 4 t o d i s cu s s t h e d ep l et i o n o f t h e Tru st an d t h ei r co n cern o v er i t s

m an ag em en t

. In J u l y 2 0 0 4

, th e s en io r v i ce p res id en t ag ai n wro t e t o t h e p l ai n t i ffs

rei t erat i ng t h e b an k ’ s p o si t io n t h at i t h ad n o t g u aran t eed an an n u al d i s t ri bu t i o n t o t h e

p l ai n t i ffs fo r li f

e i r r e s p ect i v e o f wh et her t h e Tru s t co rp u s was d ep l et ed

, an d

s u g g es t i n g t h at an y d ecl i ne i n t h e Tru st was th e res u l t o f t he fi x ed an n u al

d i s t ri b u t i o n s an d u n fav o rab l e m ark et co n d i ti o n s affect i ng th e ret urn o n t h e Tru st ’ s

i n v es t m en t s

.

By Sep t em

b er 2 0 1 1

, t h e co r

p u s o f t h e Tru s t w as co m pl et el y d ep l et ed

. W el l s

Farg o m ad e a fi n al d i s t ri bu t i o n t h at y ear t o t h e p l ai n t i ffs o f $ 7 5 ,7 4 4

, an d t hen cl o s ed

t h e T ru s t acco u n t. Fro m Feb ru ary 2 0 00 t hro u g h Sep t em b er 2 0 1 1, t h e p l ai n t i ffs

recei v ed $ 1 ,6 2 5 ,2 8 8 i n an n u al d i s t ri b u t i o n s fro m t h e T r u s t

. Th e p l ai n t i ffs d eferred

$ 3 3 5 ,7 9 6 i n fed eral cap it a l g a i n s tax es an d recei ved a ch ari tab l e d ed u ct i o n o f

$ 2 0 3 ,0 1 2 i n t ax y ears 2 0 0 0 an d 2 0 0 1.

8On Ap ri l 16

, 2 0 1 2

, t h e p l ai n t i ffs s u ed W el l s Farg o fo r d am ag es

, al l eg i n g t h at

t h e b an k i n i ts cap aci t y as t ru s t ee h ad v i o l a t e d i t s fi d u ci ary d u t i es o f p ru d en t

a d m i n i s t rat i o n an d l oy al t y b y fai l i n g t o ad here t o t h e i nv es t m en t o b ject i v es o f t h e

p l ai n t i ffs an d m i s m an ag i n g t h e as s et s o f t h e T ru s t

, cau s i ng th e co rp u s t o b e ex h au s t ed

aft er 1 1 y ears

. Th e p l ai n t iffs al s o cl ai m ed t h at W el l s Farg o h ad b reach ed a co n t ract u al

p ro m i s e t o p ro vi d e t h em wi t h an an nu al d i s t ri b u t i o n o f $1 4 2,8 1 8 fo r t he res t o f t h ei r

l i ves

.

W el l s Farg o an s wered

, d en y i n g li a b i l i t y

. Fo l l o wi n g d is co v ery

, t he p l ai n t i ffs

m o ved f o r p art i al s u m

m ary ju d g m en t o n t h ei r cl ai m fo r b reach of t he Tru s t

A g r e e m en t

, as s ert i n g th at t h e u n co n t ro v ert ed ev i d en ce s h o wed t h at t he b an k h a d a

co n tract ual o b li g at i o n to p ay t hem $ 1 4 2 ,8 1 8 an n u al l y fo r t h ei r l i fet i m es

, ev en i f t h e

Tru s t co rp u s was ex h au s t ed

. W el l s Farg o t h en m o ved fo r s u m m ary ju dg m en t o n al l

o f t h e p l ai n t i ffs ’ cl ai m s

, co n t en d i n g t h at t hey were b arred b y t h e ap p li cab le s t at u t e o f

l i m i tat i on a n d / o r th at t h e p lai n t i ffs co u l d n o t pro v e al l o f t h e n eces sary el em en t s to

reco v er u n d er ei t h er a b reach o f fi d u ci ary d u t y t h eo ry o r b reach o f co n t ract t h eo ry

.

Aft er co n du ct i n g a heari n g wh ere t he p art i es p res en t ed o ral arg u m en t

, t h e t ri al

co u rt d en i ed b o t h m o t i o n s fo r s u m m ary ju d g m en t

. Th e tri al co urt i s su ed a cert i fi cat e

9o f im

m ed i at e rev i ew, an d b o t h p art i es fi l ed ap p l icat i o n s fo r i n t erl o cu t o ry ap p eal

. W e

g ran t ed t h e ap p l icat i o n s , an d t h es e co m pan i o n ap p eal s fo l lo wed

.

Ca s e No . A1 5

A0 2 0 2

1

. We l l s Farg o co n t en d s t h at t h e t ri al co u rt erred i n d en y in g i t s m o t i o n fo r

s u m m ary ju d g m en t o n t h e p l ai n t i ffs ’ cl ai m s fo r b reach o f fi d u ci ary du t y b ecau s e (a)

an y cl ai m s rel at i n g t o t h e fai l u re t o fo l lo w t h e p l ai n t i ffs ’ i n v es t m en t o b ject i v es an d

m i s m an ag em en t o f th e Tru s t t h a t a ccru ed b efo re Ap ri l 2 0 1 0 are b arred b y t h e

ap p li cab l e st at u te o f l i m i t at io n an d (b ) an y rem ai n i ng cl ai m s t h at accru ed aft er 2 0 1 0

fai l as a m at t er o f l aw b ecau s e t h e p l ai nt i ffs h av e n o t co m e fo rward wi t h ev i d en ce

s u ffi ci en t t o p ro v e al l o f t h e es s e n t i a l e l e m e n t s o f a b reach o f fi d u ci ary d u t y cl ai m

.

W e ag ree wi t h W el l s Farg o

.

(a) Cl a i ms Rel a ti n g to th e M a n a g emen t o

f t h e Tr u s t b ef

o r e Ap r i l 2 0 1 0

. Th e

p l ai n t i ffs ’ cl ai m s rel at i n g t o t h e al l eg ed fai l u re t o fo ll o w t h ei r i n v es t m en t o b ject i v es

an d m i s m an ag em en t o f t h e T ru st t h at accru ed b efo re Ap ri l 2 0 1 0 are b arred as a m at t er

o f l aw b y t h e ap pl icab l e s tat u t e o f l i m it at i o n

. W el l s Farg o h ad t h e b urd en o f p ro v i n g

t h at t h e l i m i t at i o n p eri o d h ad ru n o n t h es e cl ai m s, s ee S m i t h v. S un t r u s t Ba n k

, 3 2 5 Ga.

Ap p

. 5 3 1

, 5 3 9 (1 ) (7 54 SE2 d 1 1 7 ) (2 0 1 4), an d i t m et t h at b urd en as a m at t er o f l aw.

10Th e p art i es d o n o t d i s p u t e t h a t t h e p l ai nt i ffs ’ b reach o f fi d u ci ary d u t y cl ai m s

are g o v ern ed b y t h e l i m i t at i o n p eri o d s et fo rt h in th e Rev i s ed Geo rg i a Tru s t Co d e o f

2 0 1 0 , OCGA § 5 3 -1 2 -3 0 7 (a). See S mi t h , 3 2 5 Ga. Ap p . at 5 3 7-5 3 8 (1 ), n .8 . OCGA

§ 5 3 -1 2 -3 0 7 (a) pro v i des t wo d i f f eren t l i m i t at i on p eri o d s fo r act i o n s b ro u g h t by

b en efi ci ari es ag ai n s t t ru s t ees – s i x y ears an d t wo y ears

. See Ha st y v. Ca st l eb er r

y

, 2 9 3

Ga. 72 7

, 7 30 (2 ) (7 4 9 SE2 d 6 7 6 ) (2 0 1 3 ); S mi t h

, 3 2 5 Ga. A p p

. at 5 3 7 -5 38 (1 ). 2 Th e

l i m i tat i on p eri o d is red uced fro m s i x t o t wo y ears fo r cl ai m s wh ere “ a b en efi ci ary h as

recei v ed a w ri t t en rep o rt t hat ad eq u at el y di s cl o s es t h e ex i s t en ce o f a cl ai m ag ai n s t t h e

t ru s t ee fo r a b reach of t ru s t .” OCGA § 5 3 -1 2 -3 0 7 (a). A wri t t en rep o rt p ro v i d es

ad eq uat e d i s cl o s u re o f a cl ai m “ i f i t pro v i des s u ffi ci en t i n fo rm at io n s o t h at t h e

b en efi ci ary k n o ws o f s u ch cl ai m or reas o n ab ly s h ou l d h av e i n qu i red i n t o t h e

ex i s t en ce o f s uch cl ai m .” Id

. If s u ch a wr i t t e n r e p o r t h as b een recei v ed b y t h e

b e n efi ci ary

, a cl ai m fo r b reach o f t ru s t i s “ b arred as t o t hat b en efi ci ary u n l es s a

p ro ceed in g to as s ert t h e cl ai m i s co m m en ced w i t hi n t wo y ears aft er re c e i p t o f t h e

rep o rt .” Id

.

“ Rep o rt ” i s n o t d efi n ed i n OCGA § 5 3 -1 2-3 0 7 (a). Bu t

2 Th e s t at ut e o f l i m i t at io n m ay b e t o l l ed b y a d efen d an t’ s frau d u l en t co n d u ct

, S mi t h

, 3 2 5 Ga. Ap p

. at 5 3 8 (1 ), b u t t h e p l ai n t i ffs co n ced ed at t h e s u m m ary j u d gm en t h eari n g t h at

t h ey were n o t cl ai m i n g t h at t h e l i m i t at i o n p eri o d h ad b een t o l l ed

.

11[o ] u r Su p rem e Co u rt recen t ly hel d t h at a “ rep o rt ” u n d er t hi s s t at u t o ry

p ro v i s i o n s h o u ld b e co ns t ru ed t o m ean a re p o r t fro m a t ru s tee t o a

b en efi ci ary co n t ai ni n g “ det ai led i n fo rm at io n ” t h at i ncl u d es “ t h e as s et s

,

l i ab i l i t i es

, recei p t s

, an d d i s b u rs em en t s o f t he t ru s t

, t h e act s o f t h e t ru s t ee,

an d t h e part i cu l ars rel at i n g t o t h e ad m in i s t rat io n o f t h e t ru s t, i n cl u d i n g

t h e t ru s t p ro v i s i o n s t h at d es cri b e o r affect s u ch b en efi ci ary ’ s i n t eres t .”

S mi th

, 3 2 5 Ga. Ap p

. at 5 4 1 (1 ) (q u o t i n g fro m Ha s t y

, 29 3 Ga

. a t 7 3 1

- 7 3 2 (2 )). See

OCGA § 5 3 -1 2 -2 4 3 (a).

Here, th e u n co n tro v ert ed ev i d en ce sh o w s t h at W el l s Farg o s en t d et ai l ed t ru s t

s t at em en t s t o t h e p l ai nt i ffs o n a q u art erl y

, y earl y

, an d s o m et i m es m on t h l y b as i s

b eg in n i n g o n M arch 2 1, 2 00 0

, an d co n ti n u in g t h ro ug h Sep t em b er 30

, 2 0 1 1

, wh en t h e

Tru s t was ex h au s t ed

. Th e p l ai n t i ffs ad m i t t ed to recei v i n g t h e s t at em en t s fro m W el l s

Farg o

. Am o ng o t h er t h i n g s

, t h e Tru s t s t at em en t s i d en t i fi ed t h e Tru s t

, t h e t ru s t ee, t h e

t i m e p eri o d co vered b y each s t at em en t

, a b reak do wn o f t h e i n v es t m en t fu n d s i n wh i ch

t h e Tru s t was i n v es t ed

, an d a d es cri p t i o n o f ev ery t ran s act i o n an d di s b u rs em en t m ad e

b y t he tru s tee d uri n g t h e t i m e p eri o d d es i gn at ed i n each s t at em en t. Th e s t a t e m en t s

i n cl u d ed an acco u nt su m m ary fo r t h e d es ig nat ed t i m e p e ri o d an d i n fo rm at i o n

reg ard i n g th e g ai n s a n d l o s s e s o n in v es tm en t s m ad e b y t h e Tru s t

, i n co m e an d

d i v i d en d recei p ts

, cu rren t y i el d s o f th e i n ves t m en t fu n d s

, an d b eg in n i n g an d en d i n g

12b al an ces

. Th es e s t at em en t s co n s i s t en t l y s h o wed t h e val u e of t h e Tru s t decl i n i n g o v er

t i m e.

Th e Tru s t s t at em en t s co nt ai n ed s u ffi ci en t l y det ai l ed i n fo rm at i o n to i n fo rm t h e

p l ai n t i ffs o f p o t en t ial cl ai m s b as ed o n t h e al l eg ed fai l u re t o fo l l ow t h ei r i nv es t m en t

o b ject i ves an d m i s m an ag em en t o f t h e Tru st

, as t he p lai n t i ffs own co n d u ct o v er t h e

y ears refl ect s

. Th e p l ai n t i ffs i n fo rm ed b an k offi ci al s o f th ei r c o ncern s o v er t h e

m an ag em en t o f t h e Tru s t as earl y as 2 0 0 2, an d t h ey ret ai n ed an at to rn ey i n 2 0 0 3 wh o

s en t a l et t er t o t h e W el l s Farg o s en i o r v ice p res i den t o f ch ari t ab le s erv i ces in d i cat i n g

t h ei r co n ti n u ed co n cern s reg ard i n g t h e m an ag em en t o f t h e Tru s t

. Th e p l ai n t i ffs m et

wi t h t he s en i o r v i ce p res i d en t i n 2 0 04 t o rei t erat e th ei r co n cern s o v er d ep l et i o n o f t h e

Tru s t an d i ts m an ag em en t

.

Un d e r th es e ci rcu m st an ces

, we co n cl u d e t h at t h e reg u l ar p eri od i c Tru s t

s t at em en t s recei v ed b y t h e p l ai n t i ffs m et th e req u irem en ts o f a “ rep o rt ” u nd er OCGA

§ 5 3 -1 2 -3 0 7 (a), an d u p o n recei pt of each s tat em en t t he t w o -y ear st at u t e o f l i m i t at i on s

b eg an t o ru n o n an y cl ai m s t h at h ad accru ed b y t h at p o i n t

. 3 See Ha mb u r g er v. PFM

3 Th e p l ai n t i ffs arg u e t h at t h e Tru s t s t at em en t s d o n o t co n s t i t u t e “ rep o rt s ” b ecau s e

t h ey d o n o t referen ce an y

s p eci fi c p ro v i s i o n o f t he Tru s t . W e are u n p ers u ad ed . In Ha s t y

, 2 9 3 Ga. at 7 3 2 (2 ), o u r Su p rem e Co u rt h el d t h at t h e “ rep o rt ” s h o ul d co n t ai n t h e “ t y p e o f

d et ai l ed i n fo rm at i o n co n t em p lat ed b y t h e Leg i s l at u re” i n O CGA § 5 3 -1 2-2 4 3 (a), n o t t h at

t h e rep ort s u n d er OCGA § 5 3 -1 2 -3 0 7 m u s t i ncl u d e ev ery i t em l is ted t o q u al i fy fo r t h e t wo

13Ca

p i ta l Mg mt

. , 28 6 Ga. Ap p

. 3 8 2

, 3 8 8 -3 8 9 (4 ) (6 4 9 SE2 d 7 7 9 ) (2 0 0 7 ) (p l ai n t i ff’ s

cl ai m s b as ed o n al l eg ed m is m an ag em en t o f ret i rem en t s av in g s acco un t b arred by

s t at u te o f l i m i t at i o n w h ere t h e p l ai n t iff recei v ed q u art er l y a c c o un t s t at em en t s t h at

d i s cl os ed t h e al l o cat io n o f st o ck h o l d i n g s i n t h e acco u n t an d t h e l o s s es s us t ai n ed as

a res u l t o f t h o s e h o l di n g s ). Co m p are Ha s t y

, 2 9 3 Ga. at 7 3 2 (2 ) (l et t er t o p l ai n t i ff fro m

h i s acco u n t an t s t h at fai led t o co n t ai n d et ai l ed i n fo rm at i o n an d “ was si m pl y a fo rm o f

g en eral co rres p o n d en ce” d i d n o t co n s t i t u t e a “ rep o rt ” u n d er OCGA § 5 3 -1 2 -3 0 7 (a)).

Acco rd in g ly

, al l o f t h e p l ai n t i ffs ’ b reach o f fi d u ci ary d u t y cl ai m s p red i cat ed o n t h e

al l eg ed fai lu re t o fo l l o w th ei r i n v es t m en t o b j ect i v es an d m i s m an ag em en t o f t h e Tru s t

are b arred as a m at t er o f l aw, ex cep t fo r cl ai m s t h at accru ed i n t h e t wo y ears b efo re

t h e p l ai n t i ffs fi l ed s u it (Ap ri l 2 0 1 0 t o Ap ri l 2 0 1 2 ).

Th e p l a in t i ffs arg ue, h o w ev er, t hat no n e o f th ei r b reach o f fi du ci ary d u t y cl ai m s

accru ed u n t i l Sep t em

b er 2 0 1 1

, wh en W el ls Farg o fi rs t fai l ed t o p ay t h em t h ei r fu l l

an n ual d i s t ri bu t i o n o f $ 1 4 2,8 1 8, b ecau s e t h at was wh en t h ey were fi rs t d am ag ed by

t h e b an k ’ s m an ag em en t o f t h e Tru s t. W e d i s ag ree.

y ear s t at u t e o f l im i t at i o n s. See S mi t h

, 3 2 5 Ga. Ap p

. at 5 4 1 (1 ). Th e T ru st s t at em en t s

, as

p rev i o u s l y d i scu s s ed

, p ro v i ded s uffi ci en t l y det ai led i n fo rm at io n t o p u t t h e p l ai n t i ffs o n

act u al o r co n s t ru ct i v e n o t i ce o f an y cl ai m s

.

14Geo rg i a co u rt s h av e reject ed ap p l i cat i o n o f a co n t i n u i n g t o rt t h eo ry t o cl ai m s

fo r b reach o f t ru s t. See Al len v. Co l u mb u s Ba n k & Tr u s t Co

. , 2 44 Ga. Ap p

. 2 7 1

, 2 7 2

(1 ) (5 3 4 SE2 d 9 1 7 ) (2 0 0 0). Rat h er, “ [e] ach act o f al l eg ed m i s m an ag em en t b y a t ru s t ee

t h at d et ri m en t al ly affect s a b en efi ci ary creat es a n ew cau s e o f act i on fo r t h at s p eci fi c

act o f m i s m an ag em en t ” o n wh ich t h e s t at ut e o f l i m i t at i o n b eg i ns t o ru n

. S m i t h , 3 2 5

Ga. Ap p

. at 5 4 5 (2 ) (b ). See Ma yf i el d v. Hei ma n

, 3 1 7 Ga. A p p

. 3 22

, 3 2 5 (1 ) (7 3 0

SE2 d 6 8 5) (2 0 1 2); Al l en , 2 44 Ga. Ap p . at 2 7 2 (1 ).

Fu rt herm o re, th e l im i t at i o n p e r i o d b eg i n s t o ru n w h en t h e p l ai nt i ff fi rs t

ex p eri en ces an y ap p reci ab l e harm

, ev en t h o u g h t h e h arm m i g ht b e s l i g h t an d m o s t o f

t h e harm o ccu rs at s o m e l at er p o i n t

. Cf. S to cks v. Gl o ver

, 2 2 0 G a. Ap p

. 5 5 7

, 5 5 8 (1 )

(4 6 9 SE2 d 6 7 7) (1 9 9 6 ) (b reach o f fi d u ci ary d u t y cl ai m ag a i n s t at to rn ey “ b eg i n s as

s o o n as t here i s a b reach o f t h e a t t orn ey ’ s d u ty an d s o m e d eg ree o f h arm

, h o wev er,

ev en if t h e d eg ree o f h arm i s m i n i m al an d m u ch o r m o st o f t h e h arm

o ccu rs l at er”);

Leo n Jo n es Feed & Gr a i n v. Gen

. Bu s i n es s S vcs

. , 1 7 5 Ga. A p p

. 5 6 9

, 57 0 (3 3 3 SE2 d

8 6 1 ) (1 9 8 5 ) (n o t i n g t hat cau s e o f act i o n accru es “ wh ere ev en s l i g h t o r n o m i n al

d am ag e o ccu rs as a res u l t o f th e wro n g fu l act ” i n th e co n t ex t o f a cl ai m fo r n eg l i g en t

p erfo rm an ce o f fi nan ci al an d t ax ad v ice s erv i ces ). Bas ed o n t h i s p ri n ci p l e, we h av e

h el d t h at each t im e a t ru s tee m ak es a n in v es tm en t wh i ch t h e b en efi ci ary al l eg es to

15h av e co n s t i t u t ed m i s m an ag em en t , t h e t ru s t i s det ri m en t al l y affect ed , an d a cau s e o f

act i on accru es in fav o r o f t h e b en efi ci ary at t h at p o i n t an d t h e l i m i t at i o n p eri od b eg i n s

t o ru n o n t h at s p eci fi c cl ai m . See Ma yf i el d , 3 17 Ga. Ap p. at 3 25 (1 ); Al l en

, 2 4 4 Ga.

Ap p . at 2 7 2 (1 ).

W h en t h es e p ri n ci p l es are ap p l i ed t o t h e p res en t cas e, i t i s cl ear t h at an y cl ai m

fo r b reach of fi d u ci ary d u t y b y t h e p lai n t iffs b as ed o n W el l s Farg o’ s d eci s i o n t o sel l

al l o f t h e A n al o g s t ock o n Feb ru ary 2 8, 2 0 0 0

, aft er t he v al u e o f t h e s t o ck h ad d ecl i n ed

$ 2 2 5 ,2 6 6 fro m th e d ay o f t h e t ran s fer, accru e d o n t h e d at e o f t h e s t o ck sal e. See

Ma yf i el d

, 3 1 7 Ga. Ap p

. at 3 25 (1 ); Al l en

, 2 44 Ga. Ap p

. 2 7 2 (1 ). Li k ewi s e, an y b reach

o f fi d uci ary d u t y cl ai m b a s e d o n We l l s Farg o ’ s al l eg ed fai l u re t o co m pl y wi t h t h e

p l ai n t i ffs ’ i n ves tm en t o b j ect i v es an d m i s m an ag em en t of th e Tru s t ’ s i nv es t m en t

p o rt fo l i o accru ed o n t h e d at e t h e s p eci fi c i n v es t m en t was m ad e w i t h wh i ch t h e

p l ai n t i ffs t ak e i s s u e

. See id

. Co n s eq u en t l y

, in l i gh t o f t h e ap p l i cab l e t wo -y ear

l i m i tat i on peri o d

, al l o f t h e p l ai n t i ffs ’ b reach o f fi du ci ary d ut y cl ai m s are b arred

,

ex cep t fo r t h os e bas ed o n s p eci fi c i n ves t m en t d eci s i o n s m ad e b y W el l s Farg o wi t h in

t w o ye ars o f wh en t h e l aws u i t was fi l ed (Ap ri l 2 0 1 0 t o Ap ri l 2 0 1 2 ). Th e t ri a l c o u r t

t h erefo re erred i n fai li n g to gran t W el l s Farg o ’ s m o t i o n fo r s u m m ary ju d g m e n t o n

t h o s e cl ai m s t h at accru ed b efo re Ap ri l 2 01 0

.

16(b ) Cl a i ms Rel a ti n g t o th e M a n a g emen t o

f t h e Tr u s t a

ft er Ap r i l 2 0 1 0

. Th e

p l ai n t i ffs ’ rem ai n in g b reach o f fi d u ci ary cl ai m s t h at accru ed aft er Ap ri l 20 1 0 al s o fai l

as a m at t er o f l aw, b u t fo r a di fferen t reas o n

. It is wel l -es t ab l i s h ed t h at a d efen d an t

can s u cceed o n s u m

m ary ju d g m en t

b y s h o wi n g t h e co u rt t hat t he do cu m en t s, affi d av i t s

, d e p o s i t i on s an d

o t h er ev i d en ce i n t he reco rd rev eal t h at th ere i s n o ev i d en ce su ffi ci en t

t o creat e a ju ry i ss u e o n at l eas t on e es s en ti al el em en t o f [t he] p l ai n t iff’ s

cas e. If t h ere i s n o ev i d en ce s u ffi ci en t t o creat e a g en u in e i s s u e as t o an y

es s en t i al el em en t o f [t h e] p l a i n ti ff’ s cl ai m

, t h at cl ai m t u m b l es li k e a

h o u s e o f card s

. Al l o f t h e o t her d i s p ut es o f fact are ren d ered i m m at eri al

.

La u ’s Co r

p

. v. Ha s ki n s

, 2 6 1 Ga. 4 9 1 (4 0 5 SE2 d 4 7 4 ) (1 9 9 1). Th at i s t h e s i t u at i o n in

t h e i n s t an t cas e.

“ Es t ab l i s h i n g a cl ai m fo r b reach o f fi d u ci ary d u ty req ui res p r o of o f t h ree

el em en t s : (1 ) th e ex i s ten ce o f a fi d u ci ary d u ty ; (2 ) b reach o f t h at d u ty ; an d (3 )

d am ag e p ro xi m at el y cau s ed b y t h e b reach .” ( P u n ct uat i o n an d fo o tn o t e o m i t t ed .)

S u n T ru s t Ba n k v. Mer r i t t

, 2 7 2 Ga. Ap p

. 48 5

, 4 8 9 (2 ) (6 1 2 SE2 d 8 1 8 ) (2 0 0 5 ). A

t ru s t e e i s n o t a g u a ran t o r o f th e v al ue o f a t ru s t an d t hu s can b e h el d l i ab l e fo r t h e

d ep reci at i o n i n v al u e o f t ru s t as s et s o n ly i f t h e p l ai n t i ff s ho ws t h at t h e l o s s i n v al u e

17was cau s ed

, at leas t in p art

, by a b r e a c h o f f i d u ci ary du t y

. See C & S Na t

. Ba n k v.

Ha s ki n s

, 2 54 Ga. 1 31 , 1 3 4 (1 ) (3 2 7 SE2 d 1 92 ) (1 9 8 5 ).

Here, i t i s u n d i sp u t ed t h at t h e co rp u s o f th e Tru s t co n t i n u ed t o d ecl in e i n v al u e

fro m Ap ri l 2 0 10 u n t i l i t was co m p l et el y d ep l e t e d i n Sep t em b er 20 1 1

, b u t t h at

,

s t an d i n g al o ne, i s in su ffi ci en t t o p ro v e a b reach o f f i d u c i a r y d u ty b y W el l s Farg o.

No t ab l y

, t h e p l ai n t i ffs d id n ot p res en t an y ex p ert t es t i m o n y reg ard i n g t h e i nv es t m en t

d eci s i o n s o r m an ag em en t o f t h e Tru s t b y W el l s Farg o an d o t h erwi s e h av e fai l ed to

ci t e to an y ev i d en ce refl ect i n g wh at t h e b an k s h ou l d hav e d o n e d i f f e r e n t l y to

ad m i n is t er t h e T r u st i n v es t m en t s fro m Ap ri l 2 0 10 t o Sep tem ber 2 0 1 1 t o av o i d t h e

l o s s es t o, an d ul ti m at e ex h au s t io n o f, t h e co rp u s

. 4 No r hav e t h e p l ai n ti ffs ci t ed t o an y

4 In t h ei r ap p el l ee b ri ef, t h e pl ai n t i ffs as s ert t h at “ [a] l l [t h e b an k ’ s i n v es t m en t

m an ag er as s i g n ed t o t h e Tru s t d uri n g t h e rel ev an t ti m e p eri o d ] d i d was t o s el l o ff en ou g h

o f t h e m ut u al fu n d i nv es t m en t s each q u a r t er t o p ay [t h e p l ai n t i ffs ] t h ei r an n u i t y

d i s t ri b ut i o n.” Th e p l ai nt iffs ci t e t o o n e p ag e o f th e i n v es t m en t m an ag er’ s d ep o s i ti o n

t es t i m o n y t o s u p po rt t h ei r as s ert io n

, b u t t h e m an ag er s i m p l y t es t i fi ed o n t h at p ag e t h at

wh en d i st ri b u t i o n s were du e t h e p l ai nt i ffs

, h e wo u l d s el l s o m e o f t h e as s et s i n t h e Tru s t t o

rai se cas h ; h e d i d n o t t es t i fy t h at a l l h e d i d i n m an ag i n g t h e T ru s t was t o s el l as set s t o fu n d

t h e d i s t ri b ut i o n s

. El s ewh ere i n h i s d ep o s i ti o n

, t h e i n v es t m en t m an ag er t es t i fi ed t h at h e h ad

t h e res p o n si b i l it y fo r d et e r m i n in g wh i ch as s et s were h el d i n t he t ru s ts as s i g n ed t o h i m

, i n cl u d in g t h e Tru s t at i s s ue h ere, an d wo u l d d eci d e wh i ch eq u i ty fu n d s t o b u y o r s e l l a s

p art o f t h e al l o cat i o n o f s ecu ri t i es fo r t h o s e tru s t s

. Acco rd i n g t o t h e i nv es t m en t m an ag er,

i n m ak i n g t h es e al l o cat i o n d eci s i o n s

, h e wo u l d lo o k t o a li s t of reco m m en d ed m

u t u al fu n d s

d ev el o p ed b y t h e ban k

, an d h e wo u l d u se a s o ft w ar e p r o g r a m creat ed b y t h e b an k t h at

reco m m en d ed wh at t y

p es o f i n v es t m en t s s h o u l d b e i n cl ud ed i n a p art i cu l ar t y p e o f t ru s t.

Th e p lai n t i ffs p res en t ed n o ev i d en ce th at an y of t h e d eci s i o ns b y t h e i n v es t m en t m an ag er

18ev i d en ce refl ect i n g t h at th e d ep l et i on o f t h e Tru st as s et s was p ro xi m at el y cau s ed by

an y b reach es o f t ru s t d u ri n g t h e rel ev an t t i m e p eri od rat her t h an s o l el y as t h e res u l t

o f t he req u ired an n u al d i s t ri bu t i o n s t o t h e p l ai n t i ffs o f 7.5 p ercen t o r m ark et

co n di t i o n s

. Fu rt h erm o re, t h e p lai n t i ffs t hem sel v es ci t e t o t es ti m o n y o f a W el l s Farg o

t ru s t ad v i s o r refl ect i n g t h at i t was fo res eeab l e b y 2 0 0 8 t hat t h e co rp u s o f t h e Tru s t

u l t i m at el y wo u l d b e ex h au s t ed

, b u t t h ey n ev ert h el es s fai l ed t o p res en t an y ev i d en ce

t h at t h e l o s s es i n t h e Tru s t co u l d h av e b een rev ers ed o r ex h au s t i o n p rev en ted b y t h e

t i m e p eri o d rel ev an t h ere (Ap ri l 2 0 1 0 to Sep tem ber 2 0 1 1 ). Bas ed o n t h i s reco rd

, t h ere

h as s i m p ly b een a fai l u re o f p ro o f b y th e p l ai n t i ffs o n t h ei r b reach o f fi d u ci ary d u t y

cl ai m s rel at i n g t o t h e ad m i n i s t rat i o n o f t h e Tru s t fro m Ap r i l 2 0 1 0 o n ward

, an d t h e

t ri a l c o u r t e r r ed i n fai l i n g t o g ran t W el l s Farg o ’ s m o t i o n fo r s u m m ary ju d g m en t o n

t h es e cl ai m s

.

2

. W el l s Farg o co n t en d s t h at t he t r i a l c o u rt erred i n d en y i n g i t s m o t i o n fo r

s u m m ary ju dg m en t on t h e p l ai n ti ffs ’ cl ai m fo r b reach o f co n tract

. Th e p l ai n t i ffs

cl ai m ed t h at t h e b an k was co n tract u al l y o b l i gat ed t o p ay t h em an an n u al d is tri b u t i o n

o f $ 1 4 2,8 1 8 fo r th e rem ai n d er o f t h ei r l i v es

, i rres p ect i v e o f wh et h er t he Tru s t co rp u s

t o b u y o r s el l p art i cu l ar in ves tm en t s i n t h e Tru s t d u ri n g t h e rel ev an t t i m e p eri o d co n s t i tu t ed

a b reach o f fi du ci ary

d u t y

.

19was ex h au s t ed

. Acco rd i n g t o W el l s Farg o

, th e pl ai n l an g uag e o f t h e Tru s t A g reem en t

b el i es t h e p l ai n t iffs co n tract cl ai m

. 5 W e ag ree wi t h W el l s Farg o

.

“ In co n st ru i n g an ex p res s t ru s t

, we l o o k fi rs t an d fo rem o st t o th e l an g u ag e

t h erei n an d i nt erp ret t h at l an g u ag e t o effect u at e th e i n ten t o f t h e set t l ors

. W e t u rn to

p a ro l ev i d en ce o n ly i f t h e t ru s t i n st ru m en t i s am b ig u o u s

, an d we fi n d n o am b i g u i t y

h ere.” Ovr evi k v

. Ovr evi k

, 2 4 2 Ga. Ap p. 9 5

, 9 7 (1 ) (5 2 7 SE2 d 5 86 ) (2 00 0 ). As

p rev i o u s l y n o ted

, It em 2 (A) o f t he Tru s t Ag reem en t p r o v i d e s t h at “ [t ] h e an n u i t y

am o u n t s h a l l b e p ai d fro m i n co m e an d

, t o t he ex t en t i n co m e i s n o t s u ffi ci en t

, fro m

p ri n ci p al .” Hen ce, b y t h e ex p res s t erm s o f t h e Tru s t Ag reem en t

, t h e t ru s t ee was o n l y

o b l i g at ed t o rem i t p ay m en t s t o t h e p l ai n t i ffs fro m i n co m e o f t he Tru s t

, an d i f i n co m e

was i n s u ffi ci en t

, fro m t h e p ri nci p al o f t h e Tru st

. M oreo v er, b ecau se t h e T ru s t s t at es

t h at p ay m en t s can be m ad e fro m p ri n ci pal , t here i s a reco gn i t i o n th at p ay m en t s can

d ep let e t h e co rp u s o f t h e T ru st

, b u t no t h in g i n t h e Tru s t Ag reem en t s u g g es ts t h at t h e

t ru s t ee m u s t co n t in ue m ak i n g p ay m en t s fro m i t s o wn fu n d s i f t h e Tru s t i s d ep l et ed

.

5 W el l s Farg o al s o arg u es t h at t h e s t at u t e o f l i m it at i o n s u n d er t h e Rev i s ed Geo rg i a

T r u s t Co d e o f 2 0 1 0

, OCGA § 5 3-1 2 -3 0 7 (a), s h o u l d ap p l y t o th e p l ai n t i ffs ’ b rea c h o f

co n t ract cl ai m an d t h at a t ru s t is no t a co n t ract u n d er G eo rg i a law. W e d o n o t ad d res s t hes e

arg u m en t s i n l i g h t o f o u r co n cl us i o n t h at t h e p l ai nt iffs ’ co n t en ti o n s are i n co n s i s t en t w i t h

t h e p l ai n l an g u ag e o f t h e Tru s t Ag reem en t

.

20Co n seq u en t l y

, th e p l ai n l an g u ag e o f t h e Tru s t Ag reem en t p recl u d es t h e

p l ai n t i ffs ’ arg u m en t t h at W el l s Farg o was co n t ract u al l y o b l ig at ed to p ay t h em an

an n ual di s t ri b u ti o n fo r t h e i r l i v e s ev en aft er t h e co rp u s o f t h e T ru s t had b een

ex h au s t ed

. It fo l l o ws t h at t h e tri al co u rt erred i n d en y i n g s u m m ary ju dg m en t t o W el l s

Farg o o n t h e p l ai n t i ffs ’ b reach o f co n t ract cl ai m

.

Ca s e No . A1 5

A 02 0 3.

3 . Th e p l ai n t i ffs co nt en d t h at th e tri al co u rt erred i n d en y i n g t h ei r m o t i o n fo r

p art i al s u m

m ary ju d g m en t o n t h ei r cl ai m fo r breach o f co nt ract

. Fo r t h e reas on s

d i s cu s s ed i n Di v i s i on 2

, t h e p l ai n ti ffs ’ cl ai m fo r b reach o f co n t ract fai l ed as a m at t er

o f l aw. T h e t ri al co urt t h u s d i d n o t err i n den y i n g p art i al s u m m ary ju d g m en t t o t h e

p l ai n t i ffs o n t h ei r b reach o f co n t ract cl ai m

.

J u d g men t r ever

s ed i n Ca s e No

. A1 5

A 0 2 0 2

. Ju dg men t a

f f i r med i n Ca s e No

.

A1 5 A 0 2 0 3

. Ra

y a n d McMi l li a n , JJ., co n cu r

.

21