Jackson v. Jackson

7ermont Superior Court
Filed 07/31 2
Addison

STATE OF VERMONT
SUPERIOR COURT CIVIL DIVISION
Addison Unit Docket No. 23-C V-402

ANNE JACKSON
JEFFREY JACKSON
Vv.

WILLARD JACKSON, and
WILLARD JACKSON as Trustee for
The William Jackson Trust of 1939 and
The William Jackson Trust of 1941

FINDINGS OF FACT and CONCLUSIONS OF LAW

Petitioners Anne Jackson and Jeffrey Jackson are two of the three remainder beneficiaries
of two trusts administered by their father, Willard Jackson, as Co-Trustee. The third sibling,
Susan Jackson-Levine, also a remainder beneficiary, is not a party to this suit, nor is the other
Co-Trustee, Chris Grube. The two Petitioners seek the removal of their father as Trustee and
termination of the trusts based on a claim of breach of trust. In addition, they seek to have him
pay restitution to the trust from personal assets to restore the value of trust assets that they
believe were improvidently spent. Respondent denies any breach of trust. Both Petitioners and
Respondent seek attorneys' fees for the cost of litigation.

Following a decision from the Probate Division, a de novo bench trial was held June 17-
21, 2024. Petitioners Anne Jackson and Jeffrey Jackson are represented by Attorneys Kevin M.
Henry and Gary L. Franklin. Respondent Willard Jackson is represented by Attorneys Peter F.
Langrock and Wendy E. Radcliff.

Respondent's Motion for Judgment pursuant to V.R.C.P. 50 (a).
At the close of Petitioners' evidence, and again at the close of all evidence, Respondent
Trustee moved for judgment as a matter of law, arguing that Petitioners' evidence was an
insufficient basis for a claim. The court deferred ruling, and now denies the motion. Petitioners
introduced evidence in their direct case that Willard as Trustee had used over $16 million to
construct a high class inn as a project with personal importance to himself but the present value
of the asset is less than its cost and the business does not meet operating costs. In addition,
Petitioners presented evidence that due to the complex structure of the investments in this
significant component of Trust assets, individual remainder beneficiaries would each have a
minority interest in an unsuccessful business venture. Such evidence was sufficient to raise the
possibility of violation of a trustee's duty of loyalty to the remainder beneficiaries. Therefore,

1
Respondent was not entitled to judgment as a matter of law based solely on Petitioners’ evidence.
The motion is hereby denied.
Following the decision to defer ruling, the court continued to take evidence from both
parties. The decision below is based on all of the evidence admitted at the hearing.
The attorneys submitted both pre- and post-trial legal memoranda as well as proposed
findings of fact and responses to the proposal of the other party.

FINDINGS OF FACT
The court finds the facts as follows based on the credible evidence admitted at the
hearing.
Willard Jackson’s father, William Jackson, a resident of New York, established trusts in
1939 and 1941 for the benefit of his two children as income beneficiaries during their lives and
for the benefit of his grandchildren as remainder beneficiaries upon the deaths of his children.
His children were Willard Jackson (Co-Trustee and Respondent in this suit) and Carolyn Jackson
(later known as Carolyn Grube). William 1 also created many other trusts, resulting in a total of
approximately 40 trusts after his death of different types and benefiting various people. Assets in
all of William’s trusts totaled about $20 million at the time of his death.
William died in 1974, and Willard became a Trustee of most of William’s trusts. He
became Co-Trustee with Joseph Pokart, who had been William’s attorney and financial advisor
since the 1930’s, of Trusts now labelled Trusts 1, 2, 3, and 4, which are the ones pertinent to this
case. Willard and Carolyn each became an income beneficiary, and their children became
remainder beneficiaries. Assets in these trusts consisted primarily of securities and investments
in second mortgages, and Trust provisions gave the Trustees broad power over investments.
Willard and Carolyn, each had children. Thus the income beneficiaries were Willard and
Carolyn, and the remainder beneficiaries were Willard’s children (Susan, Jeffrey, and Anne) and
Carolyn’s children (Chris, Paul, Marianne, and Peter Grube).
Willard had spent the first three years of his own career working for a life insurance
company in which he did real estate appraisals and managed mortgage investments. After that he
worked in New York City for 33 years doing investment counselling, investment research, and
managing investment accounts. He was a partner in his firm and retired in 1989. From the time
of his father’s death in 1974, he managed the investments in the trusts his father had established.
At some point after William’s death, Willard’s sister Carolyn Grube died. Willard
continued as beneficiary of trusts 1-4. Trust terms provided that upon his death, the corpus of
Trusts 1 and 3 would go to Carolyn’s four children in equal shares, and the corpus of Trusts 2
and 4 would go to Willard’s three children in equal shares. Willard had other assets and
investments of his own, and did not need to rely on the income. With Co-Trustee Joe Pokart and

1
Because all parties have the same surname, hereinafter only first names are used throughout this decision.

2
the help of investment advisors, he diversified the trust assets. The investments were chosen and
managed for future growth rather than to provide income that Willard did not need so as to
enlarge the value of the assets that would go to William’s seven grandchildren (Willard’s children
and Carolyn’s) upon Willard’s death.
Only Trusts 2 and 4, in which Willard’s own three children are the remainder
beneficiaries, are the subject of this suit. The Grube children are the remainder beneficiaries of
Trusts 1 and 3, which have been managed in tandem with Trusts 2 and 4. Neither they nor
Petitioners’ sibling Susan, also a remainder beneficiary of Trusts 2 and 4, have joined in this suit.
Petitioners have not sought removal in this suit of Co-Trustee Chris Grube, current Co-Trustee
with Willard of all four trusts, although they subsequently filed a petition in the Probate Division
to do so.
Petitioner Jeffrey Jackson is a resident of Shelburne, Vermont, and Petitioner Anne
Jackson is a resident of the Cayman Islands. Respondent Willard Jackson is a resident of
Cornwall, Vermont. The Trusts have continued to pay taxes as New York trusts.
Both Trusts 2 and 4 were established under New York law and grant broad powers to the
trustees, including the right to “sell or otherwise dispose of any or all [existing assets] and to
invest and reinvest the proceeds thereof . . . as they in their absolute discretion shall deem proper,
wholly without regard to whether the same may be investments authorized for Trustees under the
Laws of any State in the United States. . .” Exhibits 1 and 2, Article Eighth (a).
They also specifically authorize distributions of principal in the following manner:
In the sole and absolute discretion of my Trustees or Trustee, to make all divisions
or distributions in kind, or partly in kind and partly in money whenever, pursuant
to the provisions of this indenture, they are required to divide the principal of the
trust fund into shares or portions of shares or to distribute the same among several
individuals; and for the purpose of such allotment, the judgment of my Trustees or
Trustee concerning the propriety thereof and the relative value for the purpose of
division or distribution of the securities or other property so allotted shall be
binding and conclusive on all persons interested hereunder.
Id, Article Eighth (f).
Additional provisions pertinent to this case are as follows:
“ELEVENTH: The written acceptance by the beneficiary of any account rendered by the
Trustees or Trustee shall constitute a final and complete discharge of said Trustees of Trustee as
to income and principal in respect to all matters embraced in said account.
“FOURTEENTH: The Trustees or Trustee shall not be required to make physical
division of the funds of this trust estate, except when necessary for the distribution of principal
and in their discretion, they or he may keep the trust corpus in one or more consolidated funds in
which the separate shares or portion of shares herein created shall have undivided interests.

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“FIFTEENTH: It is the intention of the parties hereto that this indenture and the trusts
hereby created and all rights hereunder shall be construed and determined in accordance with the
Laws of the State of New York.”
Id.
Willard’s investment decisions in general over the years, both for the trusts he
administered and for his own holdings, resulted in overall increased value of assets. He routinely
obtained and used advice from accountants and lawyers. He personally invested in real estate
that appreciated considerably in value. He bought waterfront property in Connecticut that
multiplied in value, and he bought 90 acres on Shelburne Point in Vermont for $300,000 that
ultimately yielded $12 million, from which he gave each of his children $1 million, separate and
apart from the trusts. He invested in a real estate development in Taft Corners that has been
profitable. He also held positions of financial responsibility in organizations. He was a Trustee of
Middlebury College for 15 years, during which time he was Chair of the Endowment Committee
and assets went from $12 million to $1.5 billion. He was a Trustee of Shelburne Farms for 35
years.
He is now 96 years old, but does not present with any diminished capacity. He testified
extensively on both direct and cross examination, including as a hostile witness, on three
separate days. He spoke with clarity and in detail about the facts and financial history of
numerous trusts, assets, investments, trust provisions, the reasons for investment decisions that
he made over the years, tax consequences related to investment properties, and the extent to
which goals were realized or not from different investments made. The court finds that his
testimony was credible and reliable.
In 1986, when the Co-Trustees were Willard and Joe Pokart, Trusts 1-4 purchased for
$1.7 million a tract of 840 acres of land with one mile of frontage on the California coast that
included a cattle ranch, timberland, a rock quarry, and an old farmhouse. Willard believed that
the price was reasonable and that it would be a good investment as it would appreciate in value.
Privately owned land on the California coast was rare as most of the oceanfront was owned by
the State of California. It was purchased as an investment asset, and Petitioners do not dispute
that the purchase of this land was a good investment. A corporation entitled “Jackson-Grube
Family Inc.” was formed to own the land. Each of the four trusts acquired 25% of the shares of
the corporation. The same year Willard as an individual purchased and renovated a separate
nearby property as a personal second home, which he named Sea Drum.

Following the purchase of the California land, over the years the Co-Trustees enlarged
the property by purchasing seven adjacent parcels that became available. As a result of these
purchases, the site now consists of 2,050 acres with 1 ½ miles of ocean frontage. It includes 1000
acres of range land on which there is an operating cattle ranch, 1000 acres of timber land
consisting mostly of a redwood forest purchased in part from previously operating timber

4
companies, and an income producing rock quarry. It also now includes an Inn as described
below. 2

Also in 1986 when the California land was purchased, the Co-Trustees pooled all the
Jackson-Grube investments together, including investments in trusts other than Trusts 1-4, which
afforded the ability to take advantage of investment opportunities with mandatory minimum
amounts that would yield higher returns than were available if the assets in each trust were
handled separately. One such investment yielded an 11% return. By 1992, the value of the
combined assets in trusts established by Willard’s father had grown to $52 million. In 1998, a
Delaware limited partnership, “The Jackson Grube Limited Partnership,” was formed to hold the
pooled assets, which then consisted mostly of stocks and fixed income securities. Each of Trusts
1-4 hold a percentage interest in the Limited Partnership, as do other trusts that were established
by William and were managed by Willard.
Every year Willard, together with his Co-Trustee Joe Pokart, presided over an annual
Family Meeting to review with his children and the Grube children the status of all of the
investments in the trusts. He was assisted at every meeting by Howard Londner, a CPA who has
worked with the Jackson-Grube trusts and investments since the 1970s. Mr. Londner had begun
by preparing tax returns, but in the 1990s became more active in preparing reports and
participating in annual family meetings to inform family members as beneficiaries about the
activities in the trusts. Although he retired from active CPA work in 2015, he has continued to act
as the liaison between the accounting firm and the family members and prepares quarterly
reports of analysis of the holdings. He was always available to family members to respond to
their questions about the investments and issues concerning the trusts.
Willard and Mr. Londner arranged for presentations by financial advisors, money
managers, and accountants at annual family meetings to keep the remainder beneficiaries
informed of the performance of all investments and future plans. The meetings lasted most of a
day. Minutes were kept and distributed to the beneficiaries following the meetings.
Over time, Willard found that both his children and the Grube children were not
particularly interested in the specifics of investment strategy or performance. The principal of the
remainder interest they would receive in the future was growing in value due to the emphasis on
growth rather than income. In the meantime, he individually and the children were receiving
returns on assets outside of the trusts.
At the 1998 Family Meeting, Joseph Pokart retired as Co-Trustee of Trusts 1-4 after
giving a review of the status of all of the trusts. At that time the California property still had only
one mile of oceanfront and 1500 acres. The Minutes include the following: “We are in the
process of getting a permit to build an inn. Our case has been appealed three times but it looks

2
An eighth additional parcel became available at some point. After Petitioner Jeffrey Jackson objected to
the trusts purchasing it, Willard and the Grube children purchased it under separate ownership, but it is contiguous to
the site.

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like it will be approved in another year or two. The cost of the inn is estimated at over $1 million.
The ranch is expected to appreciate in value over the years.” Exhibit 15, page 4.
Willard pursued the permit process, and within a couple of years had concluded, based on
the advice of lawyers and accountants, that it was better not to renovate the existing farmhouse
but rather to build something new. It would not necessarily be designed to produce income,
which was not needed, but could be a long term investment as well as a project of interest for the
family. Other investments were increasing in value under the investment policy of promoting
growth, and Willard as the income beneficiary did not need trust assets to produce income for his
personal needs. The issue of planning for the California property was discussed at every
subsequent family meeting.
The Minutes of the 2000 Family Meeting are 8 pages long and highly detailed about all
the investments. There is a section on the California ranch. Willard reported that he believed its
value at that time to be about $10 million. A building permit had been approved.
The Minutes of the 2001 meeting state that the value of the Jackson Grube Limited
Partnership had grown to $65 million, with investment performance notably higher than the S &
P 500. A permit to construct a 10 unit bed and breakfast on the California land was in place with
no decision about when to build it.
The Minutes of the 2004 Family Meeting include, in addition to reports on other family
investments, a report of what appears to be a lengthy discussion of possibilities for the California
land. Petitioners Jeffrey and Anne were both present. Willard stated that the cost of the property
to date was about $4.5 million (at that time 1500 acres although purchase of an additional parcel
was then contemplated), and that estimated market value was $15 million. Architects presented
three options for rebuilding the ranch house with estimated costs of construction ranging from
$1,240,000 to $1,915,000. There would be additional costs for septic, landscaping, utility
hookup, architectural fees, and furnishings. The Minutes include the following:
“Points of view and pros and cons expressed by Willard and family members included:
• Provides a place for a manager or caretaker to live
• Bedrooms are more desirable to renters than a bunkroom
• 40 years from now this will still be a world-class site
• This creates something, gives the place a purpose, others can enjoy, adds value
• Should do something with the property, create a family legacy
• Nice to stay on the coast instead of in town or in a hotel
• A lot of hotel and other development in Fort Bragg
• Family has the money
• Not worth the cost, we decided against this before
• Outside advisor said there would be no problem finding a quality manager”
Exhibit 18, page 4.

The Minutes also show that a group of four persons was organized to “meet with the
architects, a prospective manager and an outside inn consultant . . .to further explore the options

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and opportunity. . . and report their findings back to the group. Family members should all think
about the options, the future of the property and what they would like to do with it. Once we
have more information we will schedule another meeting to further our discussion.” Id.

The Minutes of the 2005 Family Meeting show that Willard and Howard Londner made a
presentation for consideration by Trust 1-4 remainder beneficiaries about the possibility of
putting the land value into dynasty trusts created by each of the cousins. The value of the land
was expected to continue to appreciate. Willard had obtained advice from lawyers and
accountants that in the future when the land value had appreciated, there would likely be high
inheritance taxes that might require the descendants to have to sell. The Minutes state: “A
Dynasty Trust will eliminate inheritance taxes on the ranch for the cousins’ heirs and their
descendants forever and will assure that the ownership of the ranch stays within the family
unless the heirs agree to sell it.. . .The Inn and other ranch buildings would continue to be owned
by the four trusts and rent the land from the Dynasty Trusts. Everything may be revenue neutral.”
The plan was that the dynasty trusts could buy the land at a discounted rate of 35% of market
value. Rhode Island was one of the few states to recognize dynasty trusts. Chris Grube was a
resident of Rhode Island and thus could become a co-trustee with Willard of dynasty trusts.

The 2005 Minutes further state:

“Issues to consider and/or resolve include:
• What if a cousin does not want to create a Dynasty Trust for the ranch?
• How to assure trustee actions reflect stockholder wishes?
• What percent agreement is needed to make decisions such as selling the ranch?
• How will trustees be determined for future generations?”
Exhibit 19, page 2.

Jeffrey and Anne were both present at the meeting. It was proposed that the cousins
review sample agreements and meet with a lawyer. The Minutes also state the following
regarding the California Ranch Plans: “The vision is to redevelop the inn as a site to host
weddings, conferences, and other events.” Three phases of construction were identified.
Approval of permits was expected by mid-2006 at the earliest.

In 2006, Chris Grube became Co-Trustee of Trusts 2 and 4 with Willard. On June 30,
2006, Anne created a Dynasty Trust (Exhibit 3), and Jeffrey did so on August 10, 2006 (Exhibit
4). Their sister Susan and all four cousins also did so that year. 3 The Minutes of the Family
Meeting include the following with respect to the California Ranch: “The objective of the Inn is
to give a purpose to the Ranch, foster family involvement now and for future generations, and
generate some cash flow to at least offset expenses. Phase 1 of construction will include 3 units

3
Willard also created his own Dynasty Trust with respect to his interest in the ninth parcel of California land that the
Trusts had not bought so that it could be treated together with the lands in the Trusts.

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to rent out as vacation homes. . .It would also include an activity space and conference room for
events. Phase 2, if constructed, would include 4 or 6 additional units.” Exhibit 20, page 2.

Thus at both the 2005 and 2006 Family Meetings, prior to any money spent to build an
inn, the plan for the operation of the inn was reviewed with all beneficiaries, including that it
would not be for the purpose of generating income, but was planned to at least cover expenses.

The creation and funding of the dynasty trusts were designed to deal with the projection
that the value of the land would appreciate considerably. To implement the plan of avoidance of
inheritance taxes on the intergenerational transfer of interest in the California land, Chris Grube
and Willard as Co-Trustees of the Dynasty Trusts executed a Shareholders Agreement with the
Jackson-Grube Family Inc. corporation for the transfer of shares to the Dynasty Trusts in
exchange for promissory notes. Trusts 2 and 4 hold such notes. Willard provides all seven
children the funds to pay the annual interest on the notes. Such interest does not come out of or
reduce the principal value of the corpus of the trusts.

In executing the documents to implement this plan, all of the cousins gave up the
opportunity to receive, upon the death of Willard, a distribution from the trusts in the form of
shares in the Jackson-Grube Family Inc. corporation that owns the land. They did so for the
purpose of passing that interest in land value on to their own children without the requirement to
pay inheritance taxes in the future on the full amount of appreciated land value.
Jeffrey claims that he was “forced” to give away part of his inheritance. There is no
evidence that Jeffrey or Anne were coerced into participating in the dynasty trust plan, or that it
was done without their knowledge and consent. The Minutes of the 2005 meeting show
recognition of the real possibility that any cousin might not want to put their future interest in the
California land into a dynasty trust. All of the cousins had been given information about the
proposal at the 2005 meeting and had many months to evaluate it and consult with their own
advisors. Jeffrey and Anne now regret agreeing to the structure of the dynasty trusts holding the
value of the land, but their execution of the documents reflects their written consent to both the
creation of their dynasty trusts and the purchase by their dynasty trusts of the shares representing
their future interest in the California land.

They claim that they have been deprived of “lost” asset value that they should have been
able to receive upon Willard’s death, but they themselves made the decision to place that value in
the dynasty trusts they created for the benefit of their own children. Trusts 2 and 4 each hold
promissory notes from the dynasty trusts. If and when the land is sold, the notes will be paid to
Trusts 2 and 4 and Jeffrey and Anne will receive those funds but their share of the value of the
land that is over and above the note amount will go to their heirs without the necessity of
payment of inheritance tax. The cost of the transaction in the form of interest payable on their
promissory notes has been borne by Willard from funds outside of the trusts.

At the time the dynasty trusts were created, no money had yet been spent to renovate or
construct an inn. Shortly after the creation of the dynasty trusts, in 2006, Willard and Chris
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Grube, as Co-Trustees of Trusts 1-4, created a California limited liability company (LLC) named
the “Inn at Newport Ranch, LLC” and executed an Operating Agreement for purposes of
management of the Inn. The Inn leased 30 acres of land from Jackson-Grube Family Inc., owner
of the eight assembled land parcels, for purposes of the Inn. The Operating Agreement requires
agreement of 75% of its members for the Inn to be sold.
Willard believed that there was consensus among the seven cousins to proceed to build an
inn, and he assembled a team of architects and builders to work on it. The investments held in the
Limited Partnership were performing well. The Inn project was not intended to generate income,
but to be a family project that would be self-sustaining while in the meantime the land value was
appreciating. The value of the other investments, which also continued to be growth
investments, was apparently increasing.

Over the next few years, Willard spent considerable effort creating designs and obtaining
the necessary permits that would comply with multiple additional requirements mandated by
various State and local regulatory bodies. There were frustrations in how long the permitting
processes were taking as permits were denied and had to be reworked. This resulted in increased
expenses. The money for design, permitting, and construction came from assets in Trusts 1-4 and
costs exceeded expectations. In addition, evolving plans for the inn called for first class quality
construction. Willard took advantage of opportunities to incorporate special features such as
wide redwood slabs and unusual rocks from the quarry.

By 2014, $8 million had been spent, and the total cost was expected to be $10 million.
Co-Trustee Chris Grube deferred to Willard on the project, and Willard had the time and
willingness to run it. Willard acknowledges that if he had known when the Inn project started
how much it would ultimately cost to build, he probably would not have recommended
proceeding with the scope of what was done, but that once it was begun, it did not make sense
not to finish it. He acknowledges that he wanted an Inn that would be worthy of the spectacular
site on which it sits. He also acknowledged, as reflected in the minutes of the 2014 meeting, that
he originally ‘thought he was building a Ford but built a Mercedes.’

By this time Jeffrey in particular was not supportive of the project, and felt that too much
money was being spent. He was the most vocal in expressing dissatisfaction with the money
spent on Inn construction. Also, he did not want to wind up with a minority interest in the Inn
and be in partnership with his cousins in a business he did not support. In 2014, as a result of
expressed dissatisfactions, an Inn Committee was established to include family members in
ongoing decision-making. Anyone who wanted to participate could be a member. Its role was
advisory. Jeffrey was initially the Chair, and held monthly meetings by telephone.

In 2015 the Inn was partially complete and opened. The Minutes for 2015 show that
Jeffrey was opposed to any additional construction, which was put on hold pending realization of
profits. In 2018 the Inn was voted one of the 20 best hotels in the world, and it is the subject of a
television video program extolling the beauty of the site and fine craftsmanship of construction.
However, operating expenses have not been covered by cash flow except for 2021. The operating
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cost shortfalls have been covered by Willard and the Grubes out of funds they receive as income
beneficiaries. Thus, to date the interests of remainder beneficiaries have not been compromised
by the operating losses.

The Inn Committee did not work out very well. The Committee apparently wrote to
contractors saying they would not be paid without Committee approval. This was beyond the
advisory committee’s authority and interfered with Willard’s working relationships with
contractors. The Inn Committee was ultimately abandoned.

Willard testified that he believes that the package of land and Inn will wind up being a
“fantastic” investment in the long run because of the unique characteristics of the land and the
quality of the Inn. This combination includes extensive private oceanfront, spectacular views,
diverse property resource features (ranch, forest, quarry), eligibility for carbon offsets, and
unique quality design of the Inn buildings. He acknowledges that it will take time for the value to
catch up with the total amount spent of $16.5 million, but his opinion is that this will happen.
Approximately $5 million of assets from each of Trusts 2 and 4 was used to fund development of
the Inn. Although the occupancy rate has been disappointing, Willard believes that the prospects
are favorable for breaking even in the next few years and continuing to do so in the future as the
Inn becomes better known. Promising events are booked for late summer of 2024.

Interstate Highway 1 parallels the coastline running north/south and bisects the land. The
coast is on the west and the ranchland and redwood forests are on the east. There is a site on the
land east of the highway (not on the 30 acres leased to the Inn) with a good view that Willard
believed would be appropriate for sale as a house site. He obtained and maintained permits and
installed a septic system to ready the site for sale as a developable property. He spent
approximately $50,000-100,000 of his own funds on these costs and has not sought nor been
paid reimbursement. He testified credibly that these expenditures add value to the land and
land/inn combination.

At some unknown point in time in the past, Jeffrey needed money and asked his father
for financial help. Willard provided funds from the Jackson-Grube Limited Partnership in the
form of a loan with interest payable at 6% per year. Similarly, at some point Anne asked her
father for financial help, and the same occurred. Between the two of them, as of December of
2023, together they had borrowed a total of $4.8 million. Mr. Londner provided a letter each year
with the amount borrowed and the interest charged. Although they were obligated to pay interest,
in 2019 the Jackson family members who would have benefitted from that interest agreed to
forego all interest payable retroactive to the beginning of each of those loans, and the Grube
beneficiaries agreed to an interest rate reduction from 6% to 3%. Altogether, the amount of
interest for which Jeffrey and Anne would have been liable if interest had not been forgiven is
approximately $2.5 million.

Anne believes that the loan funds should have been given to her as an advancement on
her remainder interest and not a loan, and claims that Howard Londner agrees. However, the

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2019 letter from Mr. Londner contains a hindsight comparison of what was done and would have
happened if an advancement had been given. It does not constitute an opinion that Willard
violated his obligations as Trustee. In any event, there is no evidence that assets in Trusts 2 and 4
were misused in any way in connection with the manner in which Jeffrey and Anne borrowed
money from the Limited Partnership. There was no impact at all on the assets in Trusts 2 and 4
from these transactions. Jeffrey and Anne had no right to an advancement against their remainder
interest, and they benefitted from the loans made available to them from other assets and the
forgiveness of interest.

The dynasty trusts owe interest to Jackson-Grube Family Inc. on the promissory notes
given to purchase the shares in connection with the land asset. Willard pays that interest from his
personal funds on behalf of his children in the annual amount of approximately $29,000 each.
Jeffrey is worried about having to pay that when Willard dies. Jeffrey acknowledges that Willard
gave him and each of the children, from Willard’s personal investments, an asset that provides
each of them with annual income of $170,000 per year. Again, this is unrelated to any activity in
Trusts 2 and 4.

Jeffrey wants Willard removed as Trustee, dissolution of Trusts 2 and 4, and a
requirement that Willard pay $5 million to each of Trusts 2 and 4 to restore what was spent on
the Inn. He claims that he never consented to the construction of the Inn, but admits that he does
not know whether consent was required or not. The evidence is that it was not. Jeffrey would
prefer that the Trusts held assets that were separately managed rather than pooled. He believes
that Willard ‘has not been a careful steward of the assets,’ but has used Trust assets for his own
personal Inn project. 4 He believes that Willard was not honest with the family. Jeffrey believes
that Willard intended to build a ‘Mercedes’ from the beginning; that he wanted something that
people would recognize as Willard’s creation, and that it was done as a vanity project using trust
funds.

He questions whether Willard, given his age, should maintain assets in the Trusts that
have potential long-term value that will ripen over time (as opposed to assets with current
maximum potential value), and favors common stocks that can be immediately traded. Over the
years he had disagreed about the advisability of long-term private equity investments that would
not pay out for 10-15 years, and believed that the Trust should have invested only in stocks. He
apparently believes that the Trust should be holding investments that would provide him with
immediate liquidity and flexibility on his father’s death. It is noted that at the time William
established the Trusts, and for some time after his death, the Trusts held second mortgages, with
the Trustees having specific power to buy the mortgaged property (Exhibits 1 and 2, Article
Eighth (b).) These would not have provided the remainder beneficiaries with sole ownership of
liquid assets upon Willard’s death. They probably would have resulted in fractional interests to
the remainder beneficiaries. The history of investments in the Trusts shows that equity

4
He has no complaints about Willard’s investments in common stocks or private investments.

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investments have been common with a clear record of substantial growth in value. The benefit
will pass to the remainder beneficiaries on Willard’s death.
In general, the evidence shows that Jeffrey is not particularly knowledgeable about
financial investments. He is focused on wanting to have liquid assets distributed to him at the
time of Willard’s death.

Anne testified that she is in agreement with Jeffrey and seeks the same outcome. She is a
bookkeeper by profession. From 2015 to 2022 she was the bookkeeper for the Inn and spent
considerable time at the Inn although sometimes she worked remotely from the Cayman Islands.
After Jeffrey resigned as Chair of the Inn Committee, she became Chair. In 2017 she wrote a
letter urging the family to come together and support the Inn project, but she has since joined
Jeffrey in his positions on family finances. She believed that Chris Grube was going to support
the position she and Jeffrey are taking, but he declined to join this lawsuit. Jeffrey and Anne have
now brought a separate suit against him in Probate Court for breach of trust.

Jeffrey and Anne believe that Willard knew before the dynasty trusts were signed that he
planned to use Trust funds to build a legacy to himself, and that promptly after the dynasty trusts
were signed he raided the assets to build his dream. This is their interpretation of what his motive
must have been, but the evidence does not support this belief on their part.

Willard believes that the Inn will break even on a cash flow basis within the next few
years as the property becomes more known. He believes that the property will continue to
become more valuable because of the scarcity of oceanfront land available for private ownership
and the unique quality of the Inn. Pursuant to a conservation easement, the waterfront is non-
buildable, but the consequence is high value for unobstructed waterfront views available on the
eastern portion of the land, such as the site he has made ready for development. He represented
that the non-Inn assets in the Trust are invested for appreciation and the tax consequences to
beneficiaries will be at a favorable capital gains rate. He believes that Jeffrey and Anne do not
have a good understanding of how investments work, including the effect of depreciation and
taxation on the value of assets. The evidence supports this opinion.

While Jeffrey and Anne believe that Willard intended to create essentially a permanent
monument to himself, Willard testified credibly that he believes that the land and Inn together
will prove to be a good long term investment. He also testified credibly that he is not opposed to
selling, and has discussed doing so with at least one potential buyer.
Petitioners have not shown an overall diminution in the value of trust assets administered
by Willard since 2006, which seems to be the beginning of the period of complaint, nor have
they shown that any principal assets have been diverted by him from the trusts to his personal
ownership or expenditures.
In 1993, the value of the pooled family assets managed by Willard (of which Trusts 1-4
are a part) was $52 million, having risen from $20 million at the time of William’s death. By the

12
end of 2022, the value was $122 million. $38,340 had been withdrawn, so the increase in value
for which Willard was responsible was roughly $108 million over that 29 year period. Trusts 2
and 4 assets were a portion of this pool. The specific values attributable to those two trusts are
unknown, but both trusts certainly experienced significant growth.

As of June of 2022, Trust 2 consisted of:
25% interest in Inn at Newport Ranch LLC $3,543,022
13.411% interest in Jackson-Grube LP 5,381,907
Loans from Dynasty Trusts 841,500
$9,766,429
Trust 4 consisted of:
25% interest in Inn at Newport Ranch LLC $3,543,022
11.105% interest in Jackson-Grube LP 4,456,496
Loans from Dynasty Trusts 841,500
$8,841,018

This indicates a value attributed to the Inn at Newport Ranch LLC of $14,072,189. The evidence
is that this is book value and not market value, which was and is unknown.
In addition to these assets, Willard was responsible for creating the appreciated value of
the land (over and above the loan amount) that the remainder beneficiaries dedicated to their
dynasty trusts for the benefit of their heirs. This value is also unknown.
Two appraisals were obtained in recent years, but neither of them was introduced into
evidence and the little information about them indicates that neither of them provides reliable
evidence about either the value of the Inn component of the Trust holdings, or a combined value
of the land holdings together with the Inn component. One was for $10 million, but Willard
claims it is inaccurate as it excluded the value of timber and used an inland motel to derive
building value rather than a true comparable. Another was for $27 million that apparently was
based in part on inaccurate information about what the property included. Neither figure provides
reliable value information. The court cannot determine what was included in each appraisal or
whether appropriate methodology was accurately applied. They are not usable.
As noted above, Willard believes that the value of the Inn component of the Trust
holdings will appreciate to be more than its cost of $16.5 million. Petitioners provided no
evidence of value currently attributable to the Inn at Newport Ranch, and provided no evidence
contrary to Willard’s testimony that the Inn will likely begin to break even on a cash flow basis
within a few years and will appreciate to a level that exceeds the funds spent on the cost of
construction. The court finds that Willard’s projection is reasonable given his long and successful
career in making investments, including investments in real estate properties that are likely to
appreciate over time. Petitioners provided no testimony of a person knowledgeable about real
estate values and investments.

13
Overall, Petitioners have focused on two issues: (1) cost overrun for construction of the
Inn and related current shortfalls in operating costs, and (2) creation of a complex structure that
means that when they receive their distribution as remainder beneficiaries, they will have
fractional minority interests in the pool of assets in the Jackson-Grube LP and the Inn LLC. They
have not provided evidence of poor performance of the corpus of the Trusts under Willard’s
trusteeship. They complain primarily about the current status of one asset, albeit a significant
one, that does not currently have a value equal to the cost of constructing and operating it.

They also complain that the establishment of the dynasty trusts means they no longer will
have access to increased land value upon Willard’s death, but the court has found that they
voluntarily chose to participate in the creation and purpose of those trusts to pass that value to
their own heirs and did so willingly without any coercion or wrongdoing on the part of the
Trustee. They had sufficient time to obtain advice and consider their choices, including declining
to participate.

There has been significant overall growth and appreciation in asset value for the benefit
of all of William’s grandchildren as remainder beneficiaries. Assets have been managed
specifically for growth for their benefit. Willard did not invest to emphasize return of income for
his own benefit, which he could have done. He has not used trust assets for personal
expenditures. It is reasonable to expect that trust assets spent on construction costs are likely to
be recouped in value appreciation over time. They were not spent for Willard’s personal financial
gain. The Petitioners attribute to Willard a motive of using trust assets to build a “trophy for
himself” but the evidence does not support a finding that, despite his enthusiasm for the
California project, he has invested trust assets for personal purposes or in derogation of his
responsibility to preserve trust asset value for the benefit of the remainder beneficiaries. On the
contrary, the overall performance of the corpus of the Trusts has been one of growth. There is no
evidence that Willard spent a penny of trust funds for his personal benefit. He has, in fact,
covered many expenses on behalf of the beneficiaries from his personal funds.
In Petitioners’ Response filed July 12, 2024, they claim that the value of the corpus
should have doubled every 10 years. They presented no expert testimony about the performance
of the corpus of the trusts. Jeffrey testified that his own opinion is that assets should grow in
value by 5% a year. This was not only not supported by reliable evidence, but there is no
showing that it did not occur when all asset value appreciation is taken into account. Anne
testified that she does not know the value of the trusts and has no opinion of value of the total of
land value and Inn improvements. Her complaints are the amount spent on construction, the loss
of land value to her because of the dynasty trust, and the prospect of a minority interest in the Inn
upon Willard’s death.

The fact that Willard loves the California site and pursued the project of creating
something special on it does not mean that trust funds were misused. Given his background in
responsible and successful investing, the court finds that as much as he was committed to the
project, he would not have continued if he did not responsibly think that the value would
appreciate and “catch up” to the cost in the long run, making it a sound investment. The court
finds that he was exercising responsible judgment in the decisions that he made, and he had the

14
authority to do so under the trust instruments, including the authority to invest in assets yielding
returns that may require a long term to be realized. He is also open to the prospect of selling,
which is a further indication that he is clear headed about responsible financial management and
not merely interested in creating a long-term monument to himself at the expense of
beneficiaries. There is no reason to conclude that if his expectation that revenues will come to
cover operating costs does not occur, or that if the value of the business does not catch up to cost,
he will not pursue sale for the benefit of the remainder beneficiaries. Even if that occurs, the
evidence suggests that the overall performance of trust assets for the remainder beneficiaries has
been one of substantial growth.
With respect to the claim of dishonesty, it is noteworthy that it was Willard who
organized annual Family Meetings in which independent advisors were present to describe and
explain investments and plans over most of a day each year, and minutes were kept and
distributed to memorialize the information. His duties as Trustee did not require providing that
level of transparency. Plans for the California property evolved slowly over years. Jeffrey and
Anne complain that no cost figures were presented, but there is no evidence that such
information was required in the first place, or that it would not have been available if requested.
The evidence does not support the claim that Willard dishonestly intended to spend trust funds
for his own purposes without disclosing his “true” intentions to the remainder beneficiaries.

CONCLUSIONS OF LAW
The trusts in this action were created in New York and for many years the Trustees
resided in New York. The Co-Trustees now live in Vermont and Rhode Island, but the trusts pay
taxes in New York and Respondent claims they are governed by New York law although his
attorney confirmed on the record that he has no objection to Vermont exercising jurisdiction over
the claims in this case. Thus the case is properly before this Vermont court. 14A V.S.A. § 202.
However, the parties disagree as to whether New York or Vermont law governs Willard’s
conduct as trustee and the related issue of available remedies. Petitioners rely on Vermont law
as governing the administration of the trusts, whereas Respondent claims that New York law
applies.
Under Vermont law, “[t]he meaning and effect of the terms of a trust are determined by:
(1) the law of the jurisdiction designated in the terms unless the designation of that jurisdiction's
law is contrary to a strong public policy of the jurisdiction having the most significant
relationship to the matter at issue; or (2) in the absence of a controlling designation in the terms
of the trust, the law of the jurisdiction having the most significant relationship to the matter at
issue.” 14A V.S.A. § 107. The trusts specify that “this indenture and the trusts hereby created
and all rights hereunder shall be construed and determined in accordance with the Laws of the
State of New York.” Exhibits 1 and 2, Article Fifteenth.
The court has analyzed Petitioners’ claims under both Vermont and New York standards
for administration of trusts. As described below, the outcome of this litigation is the same,
regardless of whether the court applies Vermont or New York trust administration law to the
facts and issues in this particular case.

15
Petitioners seek removal of Respondent as Trustee, termination of the trusts, and
restitution to the trust of funds that they claim Respondent improvidently spent. Under the law
in Vermont, which has adopted the Uniform Trust Code, the court may remove a trustee under
the following circumstances:
(1) the trustee is obviously unsuitable;
(2) the trustee has committed a serious breach of trust;
(3) lack of cooperation among cotrustees substantially impairs the
administration of the trust;
(4) because of unfitness, unwillingness, or persistent failure of the
trustee to administer the trust effectively, the court determines that
removal of the trustee best serves the interests of the beneficiaries;
(5) there has been a substantial change of circumstances or removal
is requested by all of the qualified beneficiaries, the Probate
Division of the Superior Court finds that removal of the trustee best
serves the interests of all of the beneficiaries and is not inconsistent
with a material purpose of the trust, and a suitable cotrustee or
successor trustee is available;
(6) for any cause, if the interests of the trust estate require it.

14A V.S.A. § 706(b)(1)–(6). “A violation by a trustee of a duty the trustee owes to a beneficiary
is a breach of trust.” 14A V.S.A. § 1001(a). Remedies for breach of trust may include, as
requested, removal of the trustee and an order to “compel the trustee to redress a breach of trust
by paying money, restoring property, or other means.” 14A V.S.A. § 1001(b)(3) and (7).

The court may approve a proposed termination of a trust under certain circumstances,
including the consent of all beneficiaries if the court concludes that “continuance of the trust is
not necessary to achieve any material purpose of the trust,” or the court “is satisfied that: (1) if
all of the beneficiaries had consented, the trust could have been modified or terminated under
this section; and (2) the interests of a beneficiary who does not consent will be adequately
protected.” 14A V.S.A. § 411(b); (e)(1)–(2). The court may also terminate a trust “if, because
of circumstances not anticipated by the settlor, modification or termination will further the
purposes of the trust,” or “continuation of the trust on its existing terms would be impracticable
or wasteful or impair the trust’s administration.” 14A V.S.A. § 412(a)–(b).

Unlike Vermont, New York did not adopt the Uniform Trust Code, but the differences
with regard to breach of trust and remedies are not material to the outcome of this action. Under
New York law, “[a]n individual seeking removal [of a trustee] bears the burden of [establishing]
that the trustee has violated or threatens to violate his or her trust or is otherwise unsuitable to
execute the trust.” Massey-Hughes v. Massey, 200 A.D.3d 1684, 1689 (NY App. Div., 4th Dept.
2021) (quoting Matter of Joan Moran Trust, 166 A.D.3d 1176, 1179 (NY App. Div, 3d Dept.
2018) (further citation omitted). “Removal of a trustee is a ‘drastic action not to be undertaken
absent a clear necessity.” Id. (quoting Matter of Rose BB., 243 A.D.2d 999, 1000 (NY App. Div.,
3d Dept. 1997). “Although discord between the trustee and others involved with the trust,
standing alone, is typically an insufficient basis for removal, such conflict may support removal
if the conflict thwarts proper administration of the trust or otherwise subverts the purpose of the
trust.” Matter of Serena W., 218 A.D.3d 597, 598 (NY App. Div., 2d Dept. 2023) (quotation and

16
citation omitted). With regard to termination under New York law, neither the parties nor the
court have identified any New York case or statute that would provide for termination of the
trusts under circumstances resembling those in this action. For example, New York allows a
court to order termination when continuation of a trust has become economically impracticable,
but the facts in this case do not even remotely support such a conclusion. See N.Y. EPTL § 7-
1.19(a)(1)–(2).

Under Vermont law, “[a] trustee is a fiduciary who owes duties of loyalty, disclosure,
impartiality, and prudence to the beneficiaries, 14A V.S.A. §§ 802–804, 813, the breach of
which is actionable.” Est. of Alden v. Dee, 2011 VT 64, ¶ 17, 190 Vt. 401. A trustee must
“administer the trust in good faith in accordance with its terms and purposes and the interests of
the beneficiaries and in accordance with this title.” 14A V.S.A. § 801. “A trustee shall
administer the trust solely in the interests of the beneficiaries” and “shall act impartially in
administering the trust, giving due regard to the beneficiaries' respective interests.” 14A V.S.A.
§§ 802(a) and 803. “A trustee shall administer the trust as a prudent person would, by
considering the purposes, terms, distributional requirements, and other circumstances of the trust.
In satisfying this standard, the trustee shall exercise reasonable care, skill, and caution.” 14A
V.S.A. § 804. The trustee must also “take reasonable steps to take control of and protect the trust
property,” and must keep the trust’s property separate from his own property. 14A V.S.A. §§
809 & 810. “Notwithstanding the breadth of discretion granted to a trustee in the terms of the
trust, including the use of such terms as “absolute,” “sole,” or “uncontrolled,” the trustee shall
exercise a discretionary power in good faith and in accordance with the terms and purposes of
the trust and the interests of the beneficiaries.” 14A V.S.A. § 814(a).

Under New York law, “[a] trustee generally has a duty of undivided loyalty to the
beneficiaries of a trust.” In re Lloyd’s Am. Tr. Fund Litig., 954 F. Supp. 656, 679 (S.D.N.Y.
1997) (citing City Bank Farmers Tr. Co. v. Cannon, 51 N.E.2d 674, 675 (NY 1943)) (additional
citation omitted). Where there are multiple beneficiaries, the trustee has a duty to deal
impartially with them. Matter of Ellen C. Stark Charitable Tr., 223 A.D.3d 951, 954 (NY App.
Div., 3d Dept. 2024). “[E]ven when the trust instrument vests the trustee with broad discretion
to make decisions regarding the distribution of trust funds, a trustee is still required to act
reasonably and in good faith in attempting to carry out the terms of the trust.” In re Est. of
Wallens, 877 N.E.2d 960, 962–63 (NY 2007).

Both Vermont and New York have adopted a version of the Uniform Prudent Investor
Act. 14A V.S.A. § 901 et seq.; N.Y. EPTL § 11-2.3. Except as modified by the provisions of a
trust, “a trustee who invests and manages trust assets owes a duty to the beneficiaries of the trust
to comply with the prudent investor rule set forth in this chapter.” 14A V.S.A. § 901(a); see N.Y.
EPTL § 11-2.3(a) (“A trustee has a duty to invest and manage property held in a fiduciary
capacity in accordance with the prudent investor standard defined by this section, except as
otherwise provided by the express terms and provisions of a governing instrument within the
limitations set forth by section 11-1.7 of this chapter.”). Vermont’s statute articulates the
standard as follows:

(a) A trustee shall invest and manage trust assets as a prudent
investor would, by considering the purposes, terms, distribution
requirements, and other circumstances of the trust. In satisfying this

17
standard, the trustee shall exercise reasonable care, skill, and
caution.
(b) A trustee’s investment and management decisions respecting
individual assets must be evaluated not in isolation but in the context
of the trust portfolio as a whole and as a part of an overall investment
strategy having risk and return objectives reasonably suited to the
trust.
(c) Among circumstances that a trustee shall consider in investing
and managing trust assets are such of the following as are relevant
to the trust or its beneficiaries:
(1) general economic conditions;
(2) the possible effect of inflation or deflation;
(3) the expected tax consequences of investment decisions
or strategies;
(4) the role that each investment or course of action plays
within the overall trust portfolio, which may include financial assets,
interests in closely held enterprises, tangible and intangible personal
property, and real property;
(5) the expected total return from income and the
appreciation of capital;
(6) other resources of the beneficiaries;
(7) needs for liquidity, regularity of income, and
preservation or appreciation of capital; and
(8) an asset’s special relationship or special value, if any, to
the purposes of the trust or to one or more of the beneficiaries.
(d) A trustee shall make a reasonable effort to verify facts relevant
to the investment and management of trust assets.
(e) A trustee may invest in any kind of property or type of
investment consistent with the standards of this chapter.

14A V.S.A. § 902(a)–(e). “Compliance with the prudent investor rule is determined in light of
the facts and circumstances existing at the time of a trustee’s decision or action and not by
hindsight.” 14A V.S.A. § 905.

New York’s statute provides as follows:

(1) The prudent investor rule requires a standard of conduct, not
outcome or performance. Compliance with the prudent investor rule
is determined in light of facts and circumstances prevailing at the
time of the decision or action of a trustee. A trustee is not liable to a
beneficiary to the extent that the trustee acted in substantial
compliance with the prudent investor standard or in reasonable
reliance on the express terms and provisions of the governing
instrument.
(2) A trustee shall exercise reasonable care, skill and caution to
make and implement investment and management decisions as a

18
prudent investor would for the entire portfolio, taking into account
the purposes and terms and provisions of the governing instrument.
(3) The prudent investor standard requires a trustee:
(A) to pursue an overall investment strategy to enable the
trustee to make appropriate present and future distributions to or for
the benefit of the beneficiaries under the governing instrument, in
accordance with risk and return objectives reasonably suited to the
entire portfolio;
(B) to consider, to the extent relevant to the decision or
action, the size of the portfolio, the nature and estimated duration of
the fiduciary relationship, the liquidity and distribution
requirements of the governing instrument, general economic
conditions, the possible effect of inflation or deflation, the expected
tax consequences of investment decisions or strategies and of
distributions of income and principal, the role that each investment
or course of action plays within the overall portfolio, the expected
total return of the portfolio (including both income and appreciation
of capital), and the needs of beneficiaries (to the extent reasonably
known to the trustee) for present and future distributions authorized
or required by the governing instrument;
(C) to diversify assets unless the trustee reasonably
determines that it is in the interests of the beneficiaries not to
diversify, taking into account the purposes and terms and provisions
of the governing instrument; and
(D) within a reasonable time after the creation of the
fiduciary relationship, to determine whether to retain or dispose of
initial assets.
(4) The prudent investor standard authorizes a trustee:
(A) to invest in any type of investment consistent with the
requirements of this paragraph, since no particular investment is
inherently prudent or imprudent for purposes of the prudent investor
standard;
(B) to consider related trusts, the income and resources of
beneficiaries to the extent reasonably known to the trustee, and also
an asset's special relationship or value to some or all of the
beneficiaries if consistent with the trustee’s duty of impartiality;
(C) to delegate investment and management functions if
consistent with the duty to exercise skill, including special
investment skills; and
(D) to incur costs only to the extent they are appropriate and
reasonable in relation to the purposes of the governing instrument,
the assets held by the trustee and the skills of the trustee.

N.Y. EPTL § 11-2.3(b)(1)–(4).

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Petitioners argue that Willard’s investment in the Inn breached his duties as trustee
because the sole purpose of the Inn was to create a project for the family that would never
generate a return on the investment; that furthermore he mismanaged the project, and that he
pursued the project out of vanity rather than with regard for the interests of the beneficiaries.
Petitioners contend that it was a further breach of duty to make Trusts 2 and 4 minority members
of the Inn LLC because, when the Trusts terminate, Petitioners will become minority members
who will “be obligated to subsidize the ongoing losses of the Inn.” Petitioners’ Proposed
Findings of Fact and Conclusions of Law at 19–20.

According to Petitioners, Willard also breached his duties by transferring a portion of the
value of the land from Trusts 2 and 4 to the dynasty trusts in exchange for promissory notes that
will not be paid unless the dynasty trusts sell the land, and by establishing and managing the
California assets “to further [his] vision […] and not the beneficiaries of the Trusts.” Finally,
they argue that by investing assets in the limited partnership, Willard breached his duty by
commingling trust assets such that Petitioners will become limited partners in an investment
partnership, and it will become difficult to withdraw from the limited partnership when Willard
dies.

The facts contradict Petitioners’ depiction of Willard’s management of the trust assets in
general and the California land and Inn projects in particular. As found above, Willard brought
his considerable and successful experience with investment to bear on his decisions in investing
the assets of Trusts 2 and 4, including investment in the California land and later the Inn.

As to the concern of commingling trust assets with those of other trusts, there is no
evidence that accounting has not been done properly to maintain the integrity of each Trust’s
assets. Exhibits show that trust financial documents have been prepared by professionals and are
precise about the fractional interest holdings of each Trust (see figures on page 13 above)
reflecting careful accounting as to the specific holdings of each trust. See also the Fourteenth
paragraph of the Trusts, quoted on page 3 above. The purpose of the Limited Partnership was to
benefit from enhanced investment opportunities, which the court finds to have been successful
when viewed as a whole, and the accounting has been done in a manner that protects the asset
value interest of each trust. Petitioners express concerns that in the future they will acquire a
minority interest, but as to the Limited Partnership, there is no evidence that the investments held
by it cannot be distributed according to percentage interests with accuracy and integrity.

As to the possibility of distribution of minority interests in the Inn at Newport Ranch
LLC, it is premature to conclude that distributions of minority interests is inevitable because sale
of the entity could occur during Willard’s life, but more importantly, Petitioners have provided
no law that precludes distribution to a remainder beneficiary of a minority interest in an LLC.
Moreover, as noted in the findings, had Willard died when the trusts held second mortgages
and/or property purchased based on second mortgages, which was authorized, remainder
beneficiaries would most likely have acquired minority interests in business properties. In
addition, had the California land not been developed at all but continued to appreciate and there
had been no dynasty trusts, upon Willard’s death each of the seven cousins would have had a
minority interest in the Jackson-Grube Family Inc. corporation that owned the land. Petitioners
have produced no legal authority for the proposition that distribution of a minority interest in an
asset constitutes a violation of a trustee’s duty to remainder beneficiaries.

20
Regarding the fact that currently the Inn does not generate revenue, nor was it designed
for the purpose of producing income, its value is part of the entire real estate package that
includes the land as well as the Inn, and the package as a whole is reasonably expected to
appreciate in value to the benefit of the trusts and ultimately, the beneficiaries and their heirs.
Investment portfolios can be made up of both assets designed for income and others designed for
growth. The California assets, including the land and Inn, fall into the growth category. The fact
that they were designed for growth, which primarily benefits the remainder beneficiaries, does
not show a violation of the trustee’s duty to the remainder beneficiaries. The facts support the
conclusion that the investments complied with Willard’s duties under Vermont as well as New
York law.

As to the creation of the dynasty trusts and exchange of shares for promissory notes at
discounted value, there was no coercion, and Petitioners had ample time and opportunity to
consider their decision to participate and to seek advice. They consented in writing through their
execution of the necessary documents. Contrary to their assertion that value was lost, they have
voluntarily passed the value to their heirs to avoid the possibility of high inheritance taxation that
would otherwise fall on their heirs. 5

The overrun in construction costs at the Inn does not, by itself, show mishandling of
funds. Petitioners have failed to show that the combined value of the land and the Inn is less
than reasonable in light of the investment. Nor does evidence support the theory that vanity was
the driving motivation for the project, or that Willard acted in any manner other than in good
faith while administering the trusts’ assets. Willard has a long history of responsible money
management and continues to consider the possibility of selling the California property versus
holding onto it for expected appreciation and coverage of operating costs.

Under both Vermont and New York law, an evaluation of Willard’s duty as prudent
investor involves consideration of the entire portfolio, not just an isolated investment that by
itself does not provide a high rate of return. The evidence suggests that the total value of the
California property may now or in the future exceed the amount invested in it. Although there is
insufficient evidence to determine this one way or the other, Petitioners have not proved
violation of the prudent investor rule as to this asset. Moreover, Vermont law, on which
Petitioners rely, is specific that “A trustee’s investment and management decisions respecting
individual assets must be evaluated not in isolation but in the context of the trust portfolio as a
whole and as part of an overall investment strategy having risk and return objections reasonably
suited to the trust.” 14A V.S.A. § 902(b). The court concludes that Willard has managed trust
assets in a way that has and continues to generate growth overall and amply provides for its
beneficiaries’ interests. Petitioners have not met their burden to show otherwise.

5
Moreover, the transfers to the dynasty trusts occurred in 2006, and this suit was not
commenced in the Probate Division until 2021. Thus, in addition to failure of proof, the Vermont
Supreme Court case of Est. of Alden v. Dee suggests that the statute of limitations precludes
claims based on the 2006 transfer of interests to the dynasty trusts.

21
Based on the findings above, the court concludes that Petitioners have not proved that
Willard breached any duty as trustee under either Vermont or New York law. Petitioners have
also not proved that any condition exists under the law of either state under which the court
should remove Willard as trustee, order him to repay funds to the trusts, or terminate the trusts.
Because such proof has not been made, it is unnecessary for the court to consider whether the
requested remedies could even occur without the CoTrustee Chris Grube being included in the
case as a Respondent. (This issue was not raised by either party.)

Attorney fees
Question 2 of Appellant’s Statement of Questions for appeal filed by Respondent Willard
Jackson on January 26, 2023 in the Probate Division, stated: “Is either party entitled to attorney
fees and costs under 14A V.S.A. § 1004?”
If Respondent seeks attorney fees, he shall file a request by August 23, 2024, supported
by time and billing records, together with a memorandum of law providing support for the
request. If filed, Petitioners shall have 14 days to file a response.

SUMMARY AND ORDER
Based on the Findings of Fact and Conclusions of Law set forth above, Petitioners have
not proved their claims and judgment shall be entered for Respondent upon resolution of any
claim for attorney fees, which must be filed by August 23, 2024 as set forth above.

Electronically signed July 31, 2024 pursuant to V.R.E.F. 9 (d).

Mary Miles Teachout
Superior Judge (Ret.), Specially Assigned

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