Bank did not have duty to monitor trust account Harry Kuskin 2008 Irrevocable Trust v. PNC Fin. Group, Inc. A-1937-21

 Bank did not have duty to monitor trust account Harry Kuskin 2008 Irrevocable Trust v. PNC Fin. Group, Inc. A-1937-21

Plaintiff trusts appealed grant of summary judgment to defendant in action over individual fiduciary's misconduct while serving as trustee. Individual was named as trustee when trusts were established in 2008. Individual opened deposit accounts for each trust with defendant, opened an investment management account for each trust in 2014 and transferred $5 million from deposit accounts into the investment management account. Individual requested a line of credit from defendant, using trust assets as collateral, for the benefit of a business in which he was a partner. Defendant denied the line of credit and individual transferred money from trust deposit accounts to his company. Individual later confessed he misappropriated funds from trusts and resigned as trustee. Plaintiffs alleged negligence, breach of contract, aiding and abetting and breach of fiduciary duty against defendant. Defendant argued it was immune under the Uniform Fiduciaries Law and trial court agreed and found plaintiffs' tort claims were barred by the economic loss doctrine. Plaintiffs argued defendant had a "special relationship" with them and failed to monitor the deposit accounts and disclose suspicious activity. Court found defendant owed no duty to monitor the trust accounts, rejected the aiding and abetting claims and found defendant was immune under the UFL.

source NJLJ July 24, 2023