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Constructive Trusts NC

Constructive trusts are frequently invoked in cases of fiduciary abuse as one of the last causes of action. A constructive trust is a legal relationship that arises when it would be inequitable for the person holding the property to retain it against the interests of the other, considering all the circumstances. If a person is found to hold property under a constructive trust, then she must relinquish the property. The Constructive Trust is a creation in equity. It’s used when there is no legal cause of action. As a result the burden of proof on the person seeking the constructive trust is clear, strong, and convincing instead of the preponderance of the evidence standard. This means it is more difficult to convince a jury. To prove a constructive trust, a plaintiff must prove two elements by clear, strong, and convincing evidence: (1) The plaintiff must prove that the defendant came into possession of the property under circumstances where in good conscience she should not retain it. This involves the consideration of many factors including the nature of the defendant’s relationship with the plaintiff, whether defendant’s possession of the property is the result of a breach of a duty owed to plaintiff, whether the defendant’s possession of the property is the result of wrongful conduct by the defendant, plaintiff’s interest in the property, and whether defendant will be unjustly enriched by her possession of the property. (2) The plaintiff must prove that the conduct of the defendant has deprived the plaintiff of a beneficial interest in the property to which she would otherwise be entitled. Constructive trusts typically arise in cases of fraud in which a fiduciary uses her position of trust to unjustly enrich herself at the expense of the one to whom she owes a duty. Because the fiduciary should not be acting in her own self-interest, the law can force her to give up her ill-gotten gains and turn over the property. Attorney Kirk Sanders at Hendrick Bryant Nerhood Sanders & Otis has experience defending against constructive trusts as well as other issues that arise in cases of fiduciary abuse. He knows how to use the law of constructive trust to best protect his clients. If you have a fiduciary abuse issue, contact the Fiduciary Litigation attorney at Hendrick Bryant. 336-723-7200

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