Court Opinion

ID: 9734437
Source: CourtListenerOpinion
Date Created: 2023-08-26 17:34:52.891992+00
Date Added: 2024-06-11T18:26:48.586849
License: Public Domain

Longo, J.
(concurring). I agree with parts II and III of the majority opinion, and, with part I, I concur in the result, on the basis of my view that the majority has reached the correct result in the wrong way.
The absolution of the trustees from the “prudent investor” standard is mentioned only once in the trust instrument, in § II (a) thereof. That section allows the trustees to depart, in my view, from the standard of fiduciary prudence only with respect to the retention or sale of the trust principal, i.e., “[i]n exercising their discretion with respect to this matter. . . .” (Emphasis added.) “[T]his matter” is only “retention or sale” of trust principal. This case involves an investment: the acquisition of the Hart*65ford Times. The trustees’ actions in this regard are thus controlled by § II (i) of the trust indenture which gives the trustees “discretion” in investing trust assets. Nowhere in § II (i) is there authority for the trustees to depart, with respect to investments, from the “prudent investor” rule, and I do not believe that the language of the preamble to § II, cited by the majority, allows such a departure.
In reading the other provisions of § II, which enumerate fiduciary powers and grant the trustees “discretion”; see §§ II (e), II (h); I cannot conclude that these references to “discretion” authorize departure from the standard of fiduciary prudence. This court has repeatedly held that the particular language employed in the trust instrument must control. Hartford National Bank & Trust Co. v. Birge, 159 Conn. 35, 43, 266 A.2d 373 (1970); Chase National Bank v. Guthrie, 139 Conn. 178, 182, 90 A.2d 643 (1952). In this connection, the law is that the use of the word “discretion” in a trust instrument, in relation to the powers of a trustee, is generally read by courts to be coextensive with a duty to exercise discretion “prudently.” 3 Scott, Trusts (3d Ed.) §227.14; Restatement (Second), 1 Trusts § 227; annot., 78 A.L.R.2d 7, 41-A9, 37 A.L.R. 559; see, e.g., Plainfield Trust Co. v. Hagedorn, 28 N.J. 483, 491, 147 A.2d 254 (1958) (power to invest as the trustees “may seem best” does not relieve them of the duty of investing as a prudent man would); Union Commerce Bank v. Kusse, 49 Ohio Op. 2d 413, 417, 251 N.E.2d 884 (1969) (an express power to invest in any kind of property without regard to statutory or judicial restrictions does not relieve the trustee from the obligation of due care and prudence in making investments). We have, moreover, explicitly held that where a will gave to a *66trustee powers to invest trust funds “ ‘in his absolute discretion, unrestricted by any legislation limiting the authority of a trustee in investing the properties and funds of his trust’ ” the trustee was nonetheless not excused from a full and accurate accounting of his administration, nor did such language remove his administration of the trust from judicial supervision. Willard v. McKone, 155 Conn. 413, 420, 232 A.2d 322 (1967); see also Conway v. Emeny, 139 Conn. 612, 619, 96 A.2d 221 (1953); Connecticut Bank & Trust Co. v. Lyman, 148 Conn. 273, 280, 170 A.2d 130 (1961); Restatement (Second), 1 Trusts § 187, comment j. Thus, I would preliminarily conclude, attaching the correct legal construction to the word “discretion,” that the court erred in holding that the trustees were not subject to the prudent investor standard with respect to matters not relating to “retention or sale of principal,” namely, the acquisition of the Times, and that the language of § II of the trust instrument, with the exception hereinafter noted, did not absolve the trustees, in toto, of a duty of prudent investment.
I agree, however, with the result of part I of the majority opinion, because the settlor held the trustees liable, in any event, only for “willful misconduct,” which did not transpire in this case. To my mind, this is the only provision of the trust which allowed departure from the trustees’ otherwise legally imposed duty of prudence. As the settlor made the trustees liable only for “willful misconduct,” I concur in the result of part I.
In this opinion Cottee, C. J., concurred.