pjc-family-2024-lib

B REACH OF D UTY BY P ERSONAL R EPRESENTATIVE

PJC 232.2

necessary to make disclosure of all important information); Montgomery v. Kennedy , 669 S.W.2d 309, 313 (Tex. 1984) (executor owes beneficiary fiduciary duty of full dis closure of all material facts known to him that might affect beneficiary’s rights); Huie v. DeShazo , 922 S.W.2d 920, 923 (Tex. 1996) (trustee’s duty of full disclosure extends to all material facts that might affect beneficiary’s rights). The question and the initial instruction in the foregoing submission differ from that in PJC 104.2 (see the current edition of Texas Pattern Jury Charges—Business, Con sumer, Insurance & Employment ). The Committee believes it is appropriate to clearly describe the transaction in question and to limit the jury’s consideration to the circum stances existing at the time of the transaction. See Archer v. Griffith , 390 S.W.2d 735, 740 (Tex. 1964); Estate of Townes v. Townes , 867 S.W.2d 414, 417 (Tex. App.—Hous ton [14th Dist.] 1994, writ denied); Miller v. Miller , 700 S.W.2d 941, 947 (Tex. App.— Dallas 1985, writ ref’d n.r.e.). Item 1 in the foregoing submission differs from that in PJC 104.2. Unlike an agent, who owes a duty of loyalty only to his principal, a personal representative of an estate has other obligations—such as paying valid claims to third parties, making certain elections, and setting aside exempt property—that should be considered in connection with the question of whether a particular transaction was fair to the beneficiaries. Item 3 differs from that in PJC 104.2 in order to focus the issue on the particular self-dealing transaction. Item 5 differs from that in PJC 104.2 in three respects. The Committee believes that the term “material facts” is more frequently used in case law. The personal representa tive’s duty to disclose in conjunction with a self-dealing transaction is limited to the facts known to the personal representative. Huie , 922 S.W.2d at 923; Montgomery , 669 S.W.2d at 313. See PJC 105.4 for instruction on common-law fraud for failure to disclose when there is a duty to disclose. If it is alleged that the personal representative should have known certain facts that were not disclosed, a negligence question may be appropriate under PJC 232.1. The last clause in item 5 is included to recognize that the information required to be disclosed must be related to the rights of the beneficiaries. The definition of “good faith” is based on cases under Texas Probate Code section 243 (codified as Tex. Est. Code § 352.052) (will contests). See Ray v. McFarland , 97 S.W.3d 728, 730 (Tex. App.—Fort Worth 2003, no pet.); Collins v. Smith , 53 S.W.3d 832, 842 (Tex. App.—Houston [1st Dist.] 2001, no pet.). Although the foregoing cases use the disjunctive standard (intention or reasonable belief), the Committee has chosen the conjunctive standard (“and”) because the Committee believes that both the subjec tive standard of intention and the objective standard of reasonableness are appropriate to measure the conduct of a fiduciary. See Lee v. Lee , 47 S.W.3d 767, 795 (Tex. App.— Houston [14th Dist.] 2001, pet. denied) (executor could recover attorney’s fees in removal action despite breaches of fiduciary duty as long as he subjectively believed his defense was viable and his belief was reasonable under existing law). But note that

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