An income beneficiary objected to the trustees’ accounting which showed that the trust had made loans to a second trust to pay premiums on a life insurance policy on the income beneficiary. The court granted summary judgment for the income beneficiary. Because the loans had never produced income in the fifteen years they had been outstanding, they were unproductive property retention of which violated the trustees’ duty to the income beneficiary and the express language of the trust prohibiting the trustees from retaining unproductive property beyond a reasonable period of time.
In re Terranova, 873 N.Y.S.2d 651 (N.Y. App. Div. 2009).
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