Fraud


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Bunch v. Byington - Gift or bequest

Posted: March 3rd, 2009 by Gaslowitz Frankel LLC

In 1998, a woman executed a will dividing her shares of stock among her children and grandchildren.  Two years later, concerned that the named executor would receive part of the stock value in fees, the woman wrote a letter to the executor saying she intended to name a granddaughter as executor, and stating that the granddaughter knew how to distribute the stock to the heirs as provided in the will.  That same day the woman authorized the transfer of all of the stock to her granddaughter.  The woman died several months later, without amending her will.  The granddaughter, acting as executor, ineffectively attempted to transfer the stock to the named relatives in accordance with the terms of the will.  Sometime later, however, the granddaughter changed her mind and decided not to transfer the stock; she sold all the shares and deposited the proceeds in a Swiss bank account.

After a trial, a jury found that though the grandmother had transferred the stock to the granddaughter, it was not a gift, and the granddaughter fraudulently had converted the stock to her own use.  The jury awarded damages of $623,560 to reimburse the estate for the value of the stock as of the woman’s date of death, along with attorney fees and punitive damages.

The Court of Appeals upheld that verdict, finding that the woman had entrusted the stock to her granddaughter under either an express or implied agreement that the granddaughter would hold the stock only for the purpose of distributing it to the heirs as provided for in the will.  Under those circumstances, she should not have retained the stock for her own use. 

292 Ga. App. 497 (2008)

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