Trustees in Oklahoma may doubt their abilities to pay attorney fees incurred in court proceedings regarding trusts. These doubts may be warranted.
On June 14, 2011, the Oklahoma Supreme Court announced its decision in May v. Oklahoma Bank, holding that “fees incurred as a result of the trustee’s negligence are not chargeable to the trust under the Oklahoma Trust Act.” When viewed in the context of the overall structure of the law governing payment of legal expenses from trust estates, the May decision may add some clarity in circumstances where the trustee must pay its own attorney fees.
But at the same time, the May decision adds a level of uncertainty for the trustee who attempts to predict how far the May decision might extend. Certainly, a trustee in Oklahoma cannot pay attorney fees from the trust if a court has determined that the attorney fees were necessitated by the trustee’s own negligence. But the scope of this rule is unclear, as is its interplay with the many equitable doctrines on payment of attorney fees from trusts.
Read more here:
http://www.okbar.org/members/BarJournal/archive2013/MayArchive13/OBJ8414Milton.aspx
