Hemphill v. Shore, No. 102,938, 2012 Kan. LEXIS 514 (Kan. Sup. Ct. Dec. 7, 2012)

(plaintiff’s grandparents established trust naming his uncle and mother as beneficiaries; plaintiff’s mother died in 1992 when he was eight years old, but plaintiff was not made aware of trust until his grandmother’s death in 2008; plaintiff alleged, shortly after mother’s death, that trustee sold farmland in trust and used proceeds to benefit trustee rather than plaintiff; trial court ruled that all claims, except a constructive fraud claim were time-barred and on appeal the parties agree this is correct, so court left only with determining whether constructive fraud claim was well-plead; trial court held that constructive fraud claim not adequately pled and dismissed claim; court of appeals affirmed; plaintiff sought further review; supreme court held trust established was not discretionary trust as determined by trial court, but support trust for the health, education, care, or maintenance of the plaintiff’s mother and uncle, so uncle as trustee did not have discretion to pay income or invade the principal for any benefit to himself;  court also held confidential relationship existed between trustee and plaintiff  and trustee could not appropriate assets for his own use, which constituted a breach of trust worthy of constructive fraud claim sufficiently pled; court also held facts pled established claim brought within 2 years of discovering alleged fraud and 10 year statute of repose does not apply to fraud claims; case remanded for resolution of constructive fraud claim).

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