ST. LOUIS — The Eastern District of the Missouri Court of Appeals upheld a trial court’s decision on several points, affirming that an appellant had breached her fiduciary duties and that the siblings were entitled to the damages and remedies awarded.
In the case of Diane Broy’s appeal against her siblings David Broy and Lisa Lyon, the court examined whether Diane Broy breached her fiduciary duties as her mother’s attorney-in-fact under a durable power of attorney (DPOA) and whether a constructive trust was warranted, according to the majority opinion filed July 30 in the Eastern District of Missouri Court of Appeals.
Diane Broy, David Broy, and Lyon were the children of the mother in question and after their father died in 2013, they began assisting their mother with financial and personal matters due to her declining mental health.
Diane Broy eventually took over the sole management of their mother’s finances, arranging for her to sign a DPOA in July 2015 without informing her siblings.
Diane Broy’s management of their mother’s finances became contentious, particularly when she changed the beneficiary designations on accounts and added herself as a co-owner on certain bank accounts. Her actions led to unequal distributions among the siblings, with Diane Broy receiving a larger share than originally planned.
The mother had expressed a desire to distribute an inheritance equally among her children, but Diane Broy’s financial management, including opening new accounts and transferring large sums to her personal account, raised concerns.
After their mother died in 2017, Diane Broy failed to probate the will, which directed equal distribution among the siblings, leading David Broy and Lyon to file a lawsuit in 2019, alleging breach of fiduciary duty, self-dealing and unjust enrichment.
At trial, Diane Broy argued that her actions were authorized under the DPOA, claiming the transfers to her accounts were reimbursements for loans, expenses and caregiving services. However, she could not provide evidence of any agreement that supported these claims.
The trial court found that Diane Broy had indeed breached her fiduciary duties by engaging in self-dealing and failing to uphold their mother’s estate plan, as demonstrated by her unauthorized actions and her knowledge of her mother’s wishes for equal distribution.
The court awarded damages to David Broy and Lyon, imposed a constructive trust on a portion of the funds, and granted attorney’s fees to the other siblings.
On appeal, Diane Broy challenged the trial court’s findings, particularly arguing that David Broy and Lyon did not qualify as “successors in interest” under Missouri law, which she believed barred them from bringing the claim.
The appellate court disagreed, interpreting the statute to include David Broy and Lyon as eligible to seek damages.
The court upheld the trial court’s decision on this and other points, affirming that Diane Broy had breached her fiduciary duties and that the siblings were entitled to the damages and remedies awarded.
Judge Michael Gardner authored a dissenting opinion. In his dissenting opinion, he expressed disagreement with the majority's interpretation of the statutory definition of "successors in interest" under section 404.717.6, arguing that David Broy and Lyon do not qualify as such under the law and therefore lack standing to bring a breach of fiduciary duty claim against Diane Broy, the attorney in fact.
He believed the majority misinterpreted the scope of "successors in interest," which should be limited to those similar in character to legal representatives like conservators or personal representatives, not simply anyone who has suffered damages.
The opinion also agreed with the majority's reversal of the constructive trust judgment but dissented from the decision to enter a money judgment in favor of David Broy and Lyon, maintaining they lack standing under the statute.
The judge suggested alternative legal remedies, such as common law claims, are available for those in David Broy's and Lyon's positions.
The appellant was represented by Henry P. Elster.
The respondents were represented by Heather M. Hall.
Attorneys declined to comment on the matter.
Missouri Court of Appeals Eastern District case number: ED111275