## Facts

- Sara Wirt Marsman’s will created a trust for her husband, T. Frederik “Cappy” Marsman, funding it with one-third of the residue and directing the trustee to provide for Cappy’s “reasonable maintenance, comfort and support.”
- The trustee (Sara’s attorney and will drafter, James F. Farr) had discretion to distribute principal for Cappy’s “comfortable support and maintenance” after considering Cappy’s other “available sources of support.”
- The will included an exculpatory clause limiting trustee liability except for the trustee’s “willful neglect or default.”
- The trust principal was about $65,000; for nearly a decade Farr made only one principal distribution ($300) despite indications Cappy’s finances had worsened.
- After Sara’s death, Cappy’s income fell, he mortgaged the residence, and he sought financial help; Farr required written justification before considering further principal distributions.
- Cappy ultimately entered an arrangement with Sara’s daughter (Sally) and Sally’s husband in which they paid house-related costs and were positioned to receive the residence, even though Cappy’s own will left the house to his later wife, Margaret.
- After Cappy’s death, the then-titleholder (Sally’s husband, later represented by executor John Nasca) sought to remove Margaret; Margaret sued, alleging Cappy would not have transferred the residence but for Farr’s failure to administer the support trust properly.

## Issues

1. Whether a trustee with discretionary authority to invade principal for a beneficiary’s “comfortable support and maintenance” has an affirmative duty to inquire into the beneficiary’s financial circumstances.
2. Whether an exculpatory clause limiting liability to “willful neglect or default” bars liability for the trustee’s failure to investigate and respond to the beneficiary’s needs.
3. Whether the trial court’s remedy—ordering conveyance of the residence to the beneficiary’s widow and surcharging the trustee to reimburse house-related expenses—was proper given causation and the trust terms.

## Decision

- The Appeals Court held that a trustee administering a discretionary support trust must make reasonable inquiry into the beneficiary’s financial condition to determine need; the trustee may not remain passive where support is a primary trust purpose.
- The court affirmed the finding that Farr breached his fiduciary duty by failing to investigate Cappy’s resources and needs and by making only minimal principal distributions in the face of worsening circumstances.
- The exculpatory clause did not eliminate responsibility for failing to perform basic fiduciary functions, though it was relevant to the scope of relief.
- The court vacated the judgment as to the remedy and remanded for further proceedings to craft relief consistent with the settlor’s intent, the evidence of harm, and the limitation reflected in the exculpatory clause.

## Legal Principles

- A discretionary power to distribute principal for a beneficiary’s support requires informed, good-faith decisionmaking consistent with the settlor’s support purpose.
- When a trust directs distributions for a beneficiary’s support and references consideration of other support sources, the trustee has an affirmative duty to inquire into the beneficiary’s financial resources and needs; the trustee need not wait for requests.
- Exculpatory clauses may limit remedies but generally do not excuse a trustee’s failure to carry out core fiduciary duties, including reasonable investigation required to exercise discretion properly.
- Equitable and surcharge remedies must be tied to the harm caused by the breach and calibrated to the trust’s terms, including any liability-limiting provisions.

## Conclusion

The court recognized an affirmative duty of inquiry for trustees administering discretionary support trusts, upheld a breach finding based on the trustee’s prolonged failure to investigate and respond to the beneficiary’s financial needs, and required a remand to determine a remedy appropriately tailored to the proven harm and the will’s exculpatory clause.


Marsman v. Nasca, 30 Mass. App. Ct. 789, 573 N.E.2d 1025 (1991)