Genauer v. Downey & Downey, P.A.

Genauer v. Downey v. Downey, P.A., 190 So.3d 131 (Fla. 4th DCA 2016)

Does a trust beneficiary have the right to intervene in trust litigation already being defended by the trustee? In this decision, which involved a dispute about the right of an attorney for a former trustee to recover his fees from the trust, the Court ultimately held that the beneficiaries of the trust had a sufficient interest in the proceeding that they should have been given the right to intervene and participate.

The trial court had held that the beneficiaries had the right to intervene, but that because the successor trustee was defending the trust, the beneficiaries did not have status as a party and did not have the right to file any motions, answers, counterclaims, or engage in any discovery.  The Court held that the limitations placed on the rights of the beneficiaries to intervene were such that the trial court's order was a de facto denial of the right to intervene.

Florida Rule of Civil Procedure 1.230 provides that, "Anyone claiming an interest in pending litigation may at any time be permitted to assert his right by intervention, but the intervention shall be in subordination to, and in recognition of, the propriety of the main proceeding, unless otherwise ordered by the court in its discretion."  In making a determination under Rule 1.230, a court must first determine whether the intervenor's purported interest entitles it to intervene.  If so, the court has the discretion to permit intervention after considering factors such as the derivation of the interest, the potential for conflicts or new issues and other relevant circumstances.  Once the court decides to permit intervention, it should decide the parameters of the intervention to the extent necessary to protect the interests of the parties.

The Court held that the trial court properly concluded that the beneficiaries of the trust had a direct and immediate interest in the litigation to support intervention.  However, because the trial court prohibited the beneficiaries from taking any direct action in the case, the Court held that the order was an abuse of the trial court's discretion and reversed the order.


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