SW Legal studies in Business

Punitive Damages May Be Imposed When Assets of Estate Are Unlawfully Converted
Description Missouri high court held that when the representative of an estate is found to have converted the assets of the estate, the representative is liable for all funds improperly converted and may be liable for a common-law action for punitive damages.
Topic Wills, Estates, and Trusts
Key Words Estate, Representative, Conversion, Damages
C A S E   S U M M A R Y
Facts BW was the beneficiary of an annuity that provided monthly payments of $3,452 for life or for 20 years, which ever was longer. BW died intestate before the first payment from the annuity was made. The probate court appointed his mother, AW, as the representative of BW's estate. At AW's request, the issuer of the annuity made payments directly to her. Later, BW's sister, LWP, filed a petition for discovery of BW's assets. LWP alleged that AW acted with "evil motive or reckless indifference" to the rights of other beneficiaries of BW's estate. LWP sued AW for punitive damages for conversion of estate funds. The trial court held that AW must repay all payments received, with interest, but held that it did not have the authority impose punitive damages in an estate matter. The decision was appealed.
Decision Reversed in part. The decision of the lower court is correct except that it does have the authority to impose punitive damages if warranted. The statute that permits probate courts, in discovery of asset cases, to enter judgments for "damages sustained," which means financial loss to the estates, does not eliminate common-law punitive damages actions for conversion of estate assets.
Citation In re Estate of Williams, 12 S.W.3d 302 (Sup. Ct., Mo., 2000)

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