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Pleading Florida’s Long-Arm Statute in Federal Trust Dispute

In order to resolve issues regarding personal jurisdiction the Court will typically analyze two questions.  First, whether personal jurisdiction exists over the non-resident defendant under Florida’s long-arm statute. And, second, whether that exercise of jurisdiction would violate the Fourteenth Amendment of the U.S. Constitution.  The United States District Court for the Southern District of Florida engaged in this analysis in Abromats v. Abromats, Case No. 16-CV-60653 (S.D. Fla. Aug. 15, 2016) (Bloom, J.).

In Abromats, the plaintiff alleged that the Court had diversity jurisdiction pursuant to 28 U.S.C. § 1332 and jurisdiction pursuant to Florida’s long-arm statute concerning trusts.  See Fla. Stat. § 736.0202.  There, the Court was asked to consider a motion to dismiss for lack of jurisdiction.  As an aside, this decision present a somewhat convoluted procedural history involving several federal and state court actions concerning the trust’s validity, among other issues raised.

In considering a motion to dismiss, the Court noted that the plaintiff bore the initial burden of alleging a prima facie case regarding jurisdiction.  Relying on the pleading standards enunciated in Twombly and Iqbal, the Court found that the plaintiff had pled sufficient facts indicating that: (i) he was a qualified beneficiary of the trust, noting that he attached a copy of same to his complaint; and, (ii) that his claims arise under Fla. Stat. § 736.0202.  Thereafter, the burden shifts to “challenge plaintiff’s allegations by affidavits or other pleadings.”

The Court reviewed in rem jurisdiction and Florida’s long-arm jurisdiction under Fla. Stat. § 736.0202 in its decision.

What is In Rem Jurisdiction?

Section 736.0202(1) of the Florida Statutes provides:

(1) In rem jurisdiction.–Any beneficiary of a trust having its principal place of administration in this state is subject to the jurisdiction of the courts of this state to the extent of the beneficiary’s interest in the trust.

In Abromats, the Court observed that Fla. Stat. § 736.0108 governed the determination of a trust’s principal place of administration.  Under that provision, unless specified in a trust instrument, the principal place of administration is the “trustee’s usual place of business where the records pertaining to the trust are kept or, if the trustee has no place of business, the trustee’s residence.” Fla. Stat. § 736.0108(2).  The court relied on affidavits from the parties in its analysis on the trust’s principal place of administration, finding that in order to transfer a trust’s principal place of administration to a jurisdiction outside of Florida, the trustee must provide notice.  There, no notice was provided.  Accordingly, the Court had in rem jurisdiction.
In addition to the in rem component of  Fla. Stat. § 736.0202, the Court determined that it also had personal jurisdiction over the defendant.  The Court reviewed Florida’s long-arm statute related to trusts in order to resolve the two prong personal jurisdiction analysis noted above.

What Is The Florida Trust Code’s Long Arm Statute?

Florida’s long-arm statute, under Fla. Stat. § 736.0202(2), provides that:

(a) Any trustee, trust beneficiary, or other person, whether or not a citizen or resident of this state, who personally or through an agent does any of the following acts related to a trust, submits to the jurisdiction of the courts of this state involving that trust:

1.  Accepts trusteeship of a trust having its principal place of administration in this state at the time of acceptance.
2.  Moves the principal place of administration of a trust to this state.
3.  Serves as trustee of a trust created by a settlor who was a resident of this state at the time of creation of the trust or serves as trustee of a trust having its principal place of administration in this state.
4.  Accepts or exercises a delegation of powers or duties from the trustee of a trust having its principal place of administration in this state.
5.  Commits a breach of trust in this state, or commits a breach of trust with respect to a trust having its principal place of administration in this state at the time of the breach.
6.  Accepts compensation from a trust having its principal place of administration in this state.
7.  Performs any act or service for a trust having its principal place of administration in this state.
8.  Accepts a distribution from a trust having its principal place of administration in this state with respect to any matter involving the distribution.

(b) A court of this state may exercise personal jurisdiction over a trustee, trust beneficiary, or other person, whether found within or outside the state, to the maximum extent permitted by the State Constitution or the Federal Constitution.

The Court repeated its determination that the trust’s principal place of administration was in Florida.  In the motions and affidavits relied upon, the Court noted that the distributions that were previously accepted by defendant—inter vivos during the life of the settlor, or otherwise—conferred jurisdiction sufficient to satisfy Florida’s long-arm statute. In short, the Court determined that the federal constitutional due process requirements were satisfied under the seminal “arise out of or relate to,” “minimum contacts” and “fair play and substantial justice” requirements.

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