USCA1 Opinion

UNITED STATES COURT OF APPEALS

FOR THE FIRST CIRCUIT
____________________
No. 94-2290

MARK A. MARCUCCI,

Plaintiff, Appellee,

v.

MARION J. HARDY,

Defendant, Appellant.

____________________
No. 95-1005

MARK A. MARCUCCI,

Plaintiff, Appellant,

v.

MARION J. HARDY,

Defendant, Appellee.

____________________

APPEALS FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEW HAMPSHIRE

[Hon. Martin F. Loughlin, Senior U.S. District Judge]

__________________________

____________________

Selya, Cyr and Boudin,

Circuit Judges.
______________

____________________

John R. Harrington, with whom David F. Conley and Sulloway &

__________________
_______________
__________
Hollis were on brief for defendant.
______

Charles A. Szypszak, with whom Laura E. Tobin and Orr and Reno
___________________
______________
____________
P.A. were on brief for plaintiff.
____

____________________

September 20, 1995

____________________

CYR, Circuit Judge.

CYR, Circuit Judge.
______________

diversity

District of

action in

Mark A. Marcucci

the United

New Hampshire in

daughter, Marion

J.

Hardy,

States District

December 1993,

had appropriated

approximately $550,000 held in trust

bench trial, the district

the proceeds Hardy received

initiated this

Court for

the

alleging that

his

to

her

for Marcucci.

own

Following

court imposed a constructive trust

from the sale of the

rejecting

Marcucci cross-appealed

his claims

to joint

from a district

accounts managed

on

Marcucci home-

stead and awarded $36,097.54 in attorney fees to Marcucci.

appealed.

use

Hardy

court order

by Hardy.

We

affirm the district court judgment, in part, and reverse in part.

BACKGROUND
BACKGROUND
__________

In the

fuel oil

late 1950s, Marcucci,

business, conveyed

owner of a

the Marcucci "family

plumbing and

homestead" in

Waterbury, Connecticut, and other assets, to his wife, Angela, in

order to insulate their holdings from potential business liabili-

ty claims.

In the

in

they caused

years,

Hardy, to be added

Aside from

early 1980s, as Marcucci and Angela

the name

of

their daughter,

to their joint bank and

an $18,000 deposit

by Hardy

advanced

Marion J.

investment accounts.

in 1987,

all funds

in

Hardy continued to

be

these joint accounts derived from Marcucci.

Although Marcucci,

listed as

Angela, and

"joint owners," Hardy

took charge

of most

disburse-

ments.

The Marcuccis retained the ability to withdraw funds from

the joint accounts, but rarely did so.

told

these

Hardy, in Marcucci's presence,

joint accounts

When Angela died

were

From time to time, Angela

that some of

intended for

in October 1988,

the monies in

Hardy's personal

the joint accounts

use.

contained

$364,663.

Angela left $50,000 in

cash to Constance Waterman, her

other daughter, but the Marcucci homestead and the residue of her

estate went to

first in

Hardy.

Hardy invited Marcucci to

Colorado and later in

Marcucci's

expenses

were

live with her,

her New Hampshire home.

defrayed

by Hardy

with

his

All of

social

security income and with funds disbursed from the joint accounts.

The

while

DeFeo family,

Hardy's neighbors,

Hardy was away from

teen months

helped care

for Marcucci

New Hampshire for approximately eigh-

during Operation

Desert Storm and

while performing

her other military duties.

In

Angela's will,

were

the summer of 1990,

Marcucci learned that the

substantially less

Constance told

prior to the

than

Marcucci that

$364,663.

Hardy

final probate of

joint account balances

At

about this

was claiming

time,

the right

to

withdraw

funds

from

the

joint accounts.

Although

Marcucci

commented at the time that he would be without substantial assets

unless he contested

Angela's will, he

decided against doing

so

after obtaining legal advice, and the will became final in August

1990.1
____________________

1Marcucci
Hardy by

admits he

Angela.

Marcucci and signed

An

knew

the homestead

April 1989 letter,

had been

left to

which Hardy wrote

for

"Dad," stated that the homestead belonged to

Meanwhile, in July 1990,

trust

("Marcucci Family

Hardy had created a revocable

Trust"), with

$173,801 from

the joint

accounts, retaining sole discretion to make inter vivos distribu_____ _____

tions

to Marcucci, the only

instrument

$150,000

to

Marcucci

and,

of the trust corpus

their serious financial

filed petitions in

uncollectible.

beneficiary.

with

his

to the DeFeo

problems.

She

showed the trust

encouragement,

family, to alleviate

Six weeks

later the

bankruptcy and the $150,000 loan

No trust

loaned

distributions were either

DeFeos

is presumed

promised or

made to Marcucci.

By November 1992, the relationship between Marcucci and

Hardy had deteriorated.

With assistance from Constance, Marcucci

moved

to

a Connecticut

contribute to his

Marcucci,

retirement

support until

95 years

old

home and

he returned to

and virtually

afford the retirement home

Hardy

live with

indigent,

accommodations.

refused to

In July

her.

is unable

to

1993, Hardy

sold the Marcucci homestead, applying the net proceeds ($108,000)

to the mortgage on her New Hampshire home.

II
II

DISCUSSION
DISCUSSION
__________

A.
A.

The Hardy Appeal

The Hardy Appeal
________________

____________________

Hardy.

Marcucci's daughter,

Marcucci
had

that "the house and cars are [Hardy's]" and that Angela

left everything

Constance.

Constance, and her husband, advised

to Hardy

The district

except for

the $50,000

court found that Marcucci knew,

given to

by the

summer of 1990, that substantial amounts

the

had been withdrawn from

joint accounts by Hardy, and that by September 1990 Marcucci

"believed that unless he contested his wife's will, he would have

no substantial assets."

1.
1.

Constructive Trust
Constructive Trust
__________________

Hardy

asserts

trust imposed on the

three

challenges

homestead proceeds.

district court erred in

to

the constructive

First, she

claims the

rejecting her affirmative defenses based

on the statute

of limitations

that

expressly withdrew

Marcucci

proceeds at trial.

trust

and laches.

his

Second, she

claim

Finally, she contends that

ruling was either

based on clearly

to the

argues

homestead

the constructive

erroneous findings of

fact or erroneous conclusions of law.

a)
a)

Affirmative Defenses
Affirmative Defenses
____________________

Hardy moved for judgment on

Civ.

trust

P. 12(c), on the alternative

claim was barred by

limitations,

restitution

grounds that the constructive

New Hampshire's three-year statute of

N.H. Rev. Stat. Ann.

Sullivan v. Marshall,
________
________

the pleadings, see Fed. R.

___

44 A.2d

508:4, I

433, 434 (N.H.

against constructive

trustee

(Supp. 1994); see

___

1945) (claim

time-barred),

or

for

by

laches.2

The

district court

that Marcucci had no

denied the

motion on

the ground

knowledge, prior to March 1993,

that Hardy

had mishandled or misapplied either joint account funds or

Marcucci assets.

Although

the district

court opinion

other

did not

____________________

2At oral argument, Hardy suggested for the first time that a
Connecticut statute
trust

claim.

of limitations applies

As this

to the

contention was neither

raised below, nor

seasonably broached on appeal, we deem it waived.

Smith, 823 F.2d
_____
unavailing.

660, 666 (1st Cir. 1987).

See Clauson v.
___ _______

all events, it is

In diversity cases, the federal courts normally look

to the choice-of-law rules of

Hampshire.

In

constructive

As

a general

statute of limitations.

the forum state, in this case

rule, New

Hampshire applies

New

its own

See Keeton v. Hustler Magazine, 549 A.2d

___ ______
________________

1187, 1191-92 (N.H. 1988).

We believe it would do so here.

revisit the matter, there can be no doubt that the court rejected

Hardy's affirmative defenses, as the constructive trust claim was

allowed to proceed.3

Under N.H. Rev. Stat. Ann.

three-year

limitations

period

508:4, I (Supp. 1994), the

commences

when

the

"plaintiff

discovers, or in the exercise of reasonable diligence should have

discovered, the injury or

omission

injury, or

complained

of."

in the exercise

its causal relationship to the

Whether

act or

claimant discovered

of reasonable diligence

the

should have

discovered it,

is a

question of fact.

Inc., 464 A.2d 279, 282 (N.H. 1983).

____

clear

error.

Reilly
______

French v.
______

R.S. Audley,
____________

Accordingly, we review for

v. United States,
_____________

863 F.2d 149,

163 (1st

Cir. 1988).

There

informed

right

cci

is undisputed

evidence that

Marcucci in the summer

of 1990 that

Constance Waterman

Hardy claimed the

to withdraw funds from the joint accounts, and that Marcu-

knew that Angela had

Nevertheless,

left the Marcucci

in the circumstances

the close family relationship,

well as the

homestead

nature and

homestead to Hardy.

presented here

including

Marcucci's age and dependency, as

purpose of Marcucci's

and the joint accounts

transfers of

the

Hardy's assertion of rights

in these assets

was not tantamount to

knowledge on the part

of

____________________

3Hardy contends that the failure to make express findings on

her affirmative

defenses necessitates remand.

v. Master Unit Die Prods., Inc.,

_____________________________
1995)
enable

(finding district court

effective

presented in Touch,
_____

appellate

See, e.g., Touch

___ ____ _____

43 F.3d 754, 757-59

(1st Cir.

decision "insufficiently clear to

review").

Unlike

however, the import of the

the

situation

district court's

factual findings in this case plainly signaled its rationale.

Marcucci that his

his

daughter was refusing

own beneficial

conduct

interest in

the assets.

served to toll the limitations

Marcucci

a reasonable

need for

any legal action.

to recognize and

sense of

Further,

honor

Hardy's

period by engendering in

confidence which

disguised the

See New Hampshire Donuts

___ ____________________

v. Skipi______

taris, 533 A.2d 351, 356 (N.H. 1987).

_____

For more than

1992

Hardy

four years

took care

October 1988 to

of Marcucci

in her

Hampshire homes.

She

"Marcucci Family

Trust," with Marcucci as

and

informed him that she had

consulted with him before

monies.

These actions were

trustee-beneficiary

Colorado and

New

established the

its sole beneficiary,

making the DeFeo

loan from trust

entirely consistent with

relationship,

November

and, whether

so

an extant

intended or

not,

sufficed

to

provide

Marcucci's confidence

family

Thus,

have believed,

his advanced

the district

conclusion that

basis

for

rekindling

in Hardy, especially in light of the close

relationship and

state.

a reasonable

court

age and

record clearly

Marcucci neither knew, nor

that his

highly dependent

warrants the

should he reasonably

daughter claimed outright

ownership of

the Marcucci homestead.

In July

stead and applied

Hampshire

1993, however,

the proceeds

residence, conduct

Hardy sold the

Marcucci home-

toward the mortgage

which unequivocally

on her

announced her

open, adverse claim to the entire Marcucci homestead.

months

thereafter,

Marcucci

initiated

the

New

present

Within six

action.

Accordingly, we agree with the district court that the action was

not time-barred,

either by the New Hampshire

statute of limita-

tions or laches.4

b)
b)

Withdrawal of Homestead Claim

Withdrawal of Homestead Claim
_____________________________

During

stated:

home."

closing

argument,

Marcucci's

trial

counsel

"we are not asking in this proceeding for return of the

Hardy frivolously contends that Marcucci thereby withdrew

his claim to the

language employed

homestead proceeds.
________

by counsel

Construed in

context, the

simply reflected the

reality that

the homestead had been sold to a third party; thus, a claim could

only be asserted against the sale proceeds.5

c)
c)

The Merits
The Merits
__________

Hardy next

preted New

Hampshire

constructive

contends that the

law

trust in these

as permitting

district court misinter-

the

circumstances.

imposition

She

of

argues that it

was error to do so absent an express promise by Hardy to reconvey

_______

the homestead

to Marcucci.

We

do not agree.

There was suffi-

____________________

4Under
foreshortened
an

the doctrine of laches,

a limitations period may be

if "unreasonable" and

unexplained delay in filing

equitable claim has prejudiced

the defendant.

See Jenot v.
___ _____

White Mountain Acceptance Corp., 474 A.2d 1382, 1387 (N.H. 1984);
_______________________________
O'Grady v.
_______
defense

Deery,
_____

45 A.2d

295, 297

does not lie, however,

contributed" to the delay.

(N.H. 1946).

if the defendant

The

laches

has "caused or

See New Hampshire Donuts, 533 A.2d at

___ ____________________

356.

5The

cases

cited by

Hardy

are totally

Hoffer v. Morrow, 797 F.2d 348, 350 (7th Cir.

______
______
a

inapposite.

See
___

1986) (noting that

criminal defendant may waive a double jeopardy claim by plead-

ing guilty); Flannery

________
1982) (observing

v. Carroll,
_______

676 F.2d 126,

132 (5th

Cir.

that plaintiff may waive a particular theory of

liability by choosing

not to plead it);

American Locomotive Co.

_______________________

v. Gyro Process Co., 185 F.2d 316, 318-19 (6th Cir. 1950) (noting
________________
that

defendant may

failing,

waive

for seven-year

contractual right
period, to

proceedings to permit arbitration).

move

to arbitration

for stay

by

of judicial

cient

circumstantial

inference that

evidence

there had

alone to

been an

support

implicit promise

reasonable

to reconvey

based on the intra-family nature of the transfer from Marcucci to

his wife, Angela.

See Pleakas v. Juris, 224 A.2d 74, 78-79 (N.H.

___ _______
_____

1966) (the promise to reconvey may be inferred from the surround-

ing circumstances, including the relationship between the parties

and the

potential for

devise of the

unjust enrichment).6

homestead to

structive trust impressed

it to Angela.7

Moreover, Angela's

Hardy remained subject

upon it at the

to the

con-

time Marcucci conveyed

Angela therefore held the homestead in trust for

Marcucci, and it was devised to Hardy subject to that trust.

_______ __ ____ _____

generally
_________

4 Austin W.

Scott & William

(4th ed.

See
___

F. Fratcher, The Law of

___________

Trusts
______

289.1

1989) [hereinafter:

Scott on Trusts]
________________

(noting

that "[d]evisee takes subject to a trust because one who

____________________

6We likewise
was

reject Hardy's

contention that

the homestead

not impressed with a constructive trust when she received it

from her mother,

mother

because the

reason for its

conveyance to

her

Marcucci's desire to insulate it from business liabili-

ty claims

ceased when Marcucci retired.

dubious, since it is

by no means clear that

liability exposure would

cerns pre-retirement
with the

intent of

transfer

no

should obtain,
______
consideration

First, the premise is

cease at retirement,

activity.
the

Marcucci's business

Second, it

parties that

longer remained

con-

seems more consonant

once the

reason for

the

reconveyance

to Marcucci

particularly since unjust enrichment

is the core

in the

viable,

at least as

constructive trust

analysis.

Cornwell v. Cornwell, 356 A.2d 683, 686 (N.H. 1976).

See, e.g.,
___ ____

________

________

7Hardy maintains
from any obligation

that

Marcucci subsequently

to reconvey.

She points

that, "as

long as [the house]

it's okay

as long as Marion's going to

of

my life."

On the

to his

was given to Marion,

contrary,

released

her

testimony

I say [sic]

take care of me the rest

this testimony

bolsters

the

district court finding that Marcucci was prepared to permit Hardy

to

retain title to

the homestead in

trust only as

long as she

continued to care for him.

pays no value for

the trust property would be

unjustly enriched

at the

keep

beneficiary's expense

it");

(Mass.

see also
___ ____

if the

Herman v.
______

Edington,
________

1954) (holding that one

consideration,

and

trustee herself).8

permitted to

118 N.E.2d

865, 869

who takes trust property without

either with

The court

trustee were

or

without

did not abuse

notice, becomes

its discretion

in

imposing a constructive trust on the homestead proceeds.

2.
2.

Attorney Fees
Attorney Fees
_____________

Marcucci

complaint,

that

the

Marcucci

demand for

which Hardy

opposed in her

district court

improperly

since her defenses were

litigate in

insight

asserted a

bad faith.

The

attorney fees

answer.

awarded

in the

Hardy contends

attorney fees

not frivolous and

to

she did not

appellate record discloses

little

into the rationale for the district court award, nor did

Hardy

request elucidation

or

reconsideration

by the

district

court.

The

district court cited to Harkeem v. Adams, 377 A.2d

_______
_____

617, 619-20 (N.H. 1977),

which held that unreasonable litigation

tactics which unnecessarily prolong litigation can constitute bad

faith

even

frivolous.

though

the

litigation position

was

not

entirely

See Marcucci v. Hardy, No. C-93-645-L, at 14 (D.N.H.

___ ________
_____

____________________

8Hardy attempts to challenge

fact:

two district court findings of

(1) that the threat of liability suits was the impetus for

the

transfer of the homestead

from Marcucci to

the

entire

than

transferred.

homestead (rather
Although

challenged these
otherwise.
F.2d at 666.

Thus,

Hardy asserts,

mere half-interest)

was

conclusorily,

she

findings below, the appellate

these claims

Angela; and (2)

were waived.

that

record indicates
See Clauson,
___ _______

823

10

Nov.16,

1994).

Hardy's failure

to challenge the

ruling in the

district court deprives us of the benefit of the district court's

rationale.

Nonetheless, absent district

ing any adequate

court findings suggest-

basis for departing from the so-called American

Rule, BTZ, Inc. v. Great Northern Nekoosa Corp., 47 F.3d 463, 465
_________
____________________________

(1st Cir. 1995) (noting,

as a general rule, that

litigants must

bear

their

own attorney

fees

absent

statutory authority,

or

agreement, to the contrary), and since we are unable to discern a

sufficient basis for doing so on the present record, the attorney

fee award must be vacated.9

B.
B.

Marcucci Cross-Appeal
Marcucci Cross-Appeal
_____________________

1.
1.

Joint Accounts
Joint Accounts
______________

Marcucci

cross-appeals from

the district

disallowing his claims to

the joint accounts.

he

title to

established exclusive

Hardy,

and, alternatively, that he

structive trust imposed

the accounts

contends that

"converted" by

was entitled to

have a con-

on the accounts, lest Hardy

be unjustly

enriched.10

a)
a)

He

court order

Conversion Claim
Conversion Claim

________________
____________________

9The citation

to Harkeem, supra, cannot

_______ _____

suffice, since the

district court articulated no basis upon which Hardy's litigation

tactics could
_______
the

be found impermissibly obdurate,

noting only that

lawsuit should never have "wended its way to federal court."

_______

See also Touch, 43 F.3d at 757-59 (discussed supra note 3).

___ ____ _____
_____
seems

to us

altogether inadequate

under the American Rule.

to take

this case

This

out from

On this record, therefore, the attorney

fee award must be vacated.

10Marcucci's
since

alternative

"claim" to

the district court supportably found

cised due

diligence in

an

accounting fails,

that Hardy had exer-

reconstructing the relevant

the joint accounts.

11

activity in

Although the

for

district court did not

state its grounds

rejecting the conversion claim, the rationale is clear.

action for

dominion or

conversion is based

control over

on the

goods which

rights of the person entitled

defendant's exercise

is inconsistent with

to immediate possession."

v. Hicks, 408 A.2d 417, 418 (N.H. 1979).

_____

e.g., McGranahan v. Dahar, 408

____ __________
_____

126 (N.H. 1979), which

the claimant must establish.

vich v. Colcord,
________________

A.2d 484,

485

of

the

Rinden
______

The right to possession

is a key element, see,

___

202

"An

(N.H. 1964)

A.2d 121,

See Wujno___ ______

(to

recover

property

allegedly

converted, plaintiff

had burden

of proving

title).11

The

tions

district court

rejected the

advanced by both parties

all-or-nothing posi-

that each held exclusive title

to the accounts notwithstanding their

joint status.12

It

found

____________________

11Under
applicable
mining

the

law

of

all

three

jurisdictions conceivably

to this claim, intent is the central factor in deter______

entitlement

to

funds

held

in

joint

accounts.

See
___

Grodzicki v. Grodzicki, 226 A.2d 656, 657 (Conn. 1967) (intent of

_________
_________
original owner

of

determining rights
N.E.2d

mutual
to

459, 461 (Mass.

account is

an

account); Blanchette
__________
1972) ("In

essential

factor

v. Blanchette,
__________

disputes arising

in

287

while both

parties to a joint bank account are still alive we have frequently

upheld allegations or findings that there was no donative in-

tent."); In re Wszolek Estate, 295 A.2d 444, 447 (N.H.

____________________
establish

inter vivos
_____ _____

gift

of joint

1972) (to

accounts, plaintiff

prove donative intent and delivery of accounts).

must

12Although Marcucci notes that his business was the original

"source" of

most of these

funds, he cites no

view that

this conclusively

the funds

once the joint accounts

names.

On the other hand,

funds were

established his entitlement

had been placed

Hardy argued that the

held in three names

the funds, foreclosing

authority for the

in all three

mere fact the

entitled her to withdraw

any possibility of

to all

conversion.

all of
But

the

form of the accounts

is not conclusive evidence of

their owner-

ship where, as here,

there is evidence of contrary

intent.

See
___

New Hampshire Sav. Bank v. McMullen, 185 A. 158, 160 (N.H. 1936).
_______________________
________

12

that "Mrs.

Marcucci stated

repeatedly and openly,

sometimes in

[Marcucci's] presence,

that

she

wanted

that she had

[Hardy] to

Marcucci, order at 5-6;

________

166 A.

247 (N.H.

established by

use

given money to

it

for

that gift

accounts,

establish his ownership

Wujnovich, 202
_________

found that he failed

not been intended

___ ____ ________

"substantial

enjoyment."

Tobin's Estate,
______________

of bank

accounts is

proof of donor's manifest intent to make uncondi-

tional delivery, and donee's acceptance).

fail to

her own

see Dover Coop. Bank v.

___ ________________

1933) (noting

[Hardy] and

of all
___

A.2d at

the funds in

485, but

amounts" for

Hardy.

Marcucci's

the joint

the district

to show that any ascertainable

_____________

as a gift to

supportable findings,

Not only did Marcucci

portion had
_______ ___

Further, Hardy

benefit.13

we cannot fault the

court

expended

Given

these

district court ruling

that

it may well have been speculative to conclude that Marcucci

sustained any damages; and

only

have

been arrived

Ofgant, 306 F.2d

______

proven, that

that the amount of any

______

at through

656, 660

conjecture.

(1st Cir. 1962)

is, they must

See
___

Robie v.
_____

("[D]amages must

not be speculative,

must not be made more than whole.").

damages could

The district

be

and [plaintiff]

court did not

err in dismissing the conversion claim.

____________________

13The
$364,663

district court
at

the time

$150,000 loan to the

gratitude

to the

found

of Angela's

benefits.

death

joint accounts
in October

DeFeos was motivated in part

people who

absence; Hardy "paid all common

lar living

that the

expenses" not

had cared

for him

held

1988; the

by Marcucci's

during Hardy's

living expenses and all particu-

covered by Marcucci's

social security

Hardy also used $173,000 from a joint account to buy a

home in Colorado,

where Marcucci lived until Hardy

and Marcucci

relocated to New Hampshire.

13

b)
b)

Constructive Trust
Constructive Trust
__________________

Alternatively,

Marcucci

claims

that

constructive

trust should have been impressed to preclude unjust enrichment of

Hardy.

Inc.,

We review

for abuse of discretion.

v. Department of Consumer

Texaco Puerto Rico,

___________________

Affairs, 60 F.3d

867, 874 (1st

____

_______________________________

Cir.

1995) (citations

that

the district

omitted).

Marcucci therefore

court's rejection

of the

constructive trust

claim constituted "a serious lapse in judgment."

Although the

record reflects

must show

Id. at 875.
___

that all but

$18,000 in

the joint accounts (deposited by Hardy) derived from Marcucci, it

is equally clear that

Moreover,

the

intended to

large sums were expended for

district

give

Hardy

court

supportably

an unspecified
___________

found

portion
_______

accounts for her exclusive use, Marcucci was

his benefit.

that

of

the

Angela

joint

present when Angela

declared her donative intent, and he knew that Hardy was handling

the joint accounts.

A constructive trust may

be created where the particu-

lar confidential or

significant

relief.

See
___

fiduciary relationship would give

potential for

unjust

Carroll v. Daigle,
_______
______

enrichment

absent

463 A.2d 885, 888

rise to a

equitable

(N.H. 1983).

The district court supportably found that Hardy used approximate-

ly

$173,000 to purchase property for herself in Colorado and the

record

would support findings

that Angela

had given

Hardy the

money for the house and that Marcucci derived benefit from living

there with Hardy.

Since a substantial portion of

the remainder

had been used for

Marcucci's own benefit, or their

mutual bene-

14

fit, and it

was impossible to determine how

much each was enti-

tled to receive, we find no abuse of discretion.

2.
2.

"Marcucci Family Trust"

"Marcucci Family Trust"
_____________________

Finally,

fiduciary duty,

N.H.

Marcucci

argues

that

under the so-called "prudent

Rev. Stat.

Ann. 564-A:3,

I (1974), by

Hardy

breached

her

man" standard, see

___

improperly lending

$150,000

from the Marcucci Family Trust to the DeFeo family, and

that she

is chargeable with the

withdrawal of

funds from

loss.

a revocable

Hardy responds

trust constituted

that her

a con-

structive revocation of the trust, (2) Marcucci consented to this

allocation of trust funds, and

(3) the allocation was reasonable

and did not violate the "prudent man" standard.

We need

not consider whether Hardy

violated the "pru-

dent man" standard, because the district court

cci

actively

encouraged the

$150,000 loan

found that Marcu-

to

the DeFeos.

trustee is not liable to a beneficiary for breach of trust if the

beneficiary

Trusts

consented to

the action.

Restatement

216(1) (1957) (endorsing estoppel

(Second) of

rationale); Mahle v.
_____

First Nat'l Bank of Peoria, 610 N.E.2d 115, 116-17

__________________________

(Ill.App.3d.)

(beneficiary consented

cert. denied,
_____ ______

622 N.E.2d 1209

to risky

(Ill. 1993).

the finding that

the knowledge that

loan to nephew),

There is ample evidence to support

Marcucci consented to

the $150,000 loan,

the DeFeos were about to

with

lose their own home

due

to financial

estopped

problems.

from challenging

Thus,

Hardy's

we

find that

decision to

loans.

15

III
III

CONCLUSION
CONCLUSION
__________

Marcucci

make the

is

DeFeo

The district court judgment is affirmed, except for the

The district court judgment is affirmed, except for the
_______________________________________________________

attorney fee award, which is vacated.

attorney fee award, which is vacated.
_____________________________________

Costs are awarded to the

Costs are awarded to the
_________________________

respective appellees in Nos. 94-2290 and 95-1005.

respective appellees in Nos. 94-2290 and 95-1005.
________________________________________________

So ordered.
So ordered.
__________

16