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Bank May Be Liable For Loss Caused By Fiduciary Breach

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One of the most important rules governing fiduciaries is that they must never commingle the money they manage for others with their own funds. This overriding principle applies to personal representatives of estates (sometimes called executors), conservators of the estates of minors and incapacitated adults, trustees, and agents operating under powers of attorney. Sometimes this powerful rule can cause problems for other individuals or organizations when they deal with fiduciaries—especially banks, who are expected to understand the financial rules.

Ronald Henry Minkin was the executor of his mother’s estate and its sole beneficiary. When he sold her house, he took the $196,000 check representing the net proceeds to Bank of America, where he kept his personal accounts, and deposited the check in an account in his own name. The bank did not question his authority to convert the estate asset to his own name.

Unknown to the bank, however, Mr. Minkin had borrowed money from lender Cochran Investment Co., and had promised to repay the loan from his mother’s estate when it was ready for final distribution. Because the sale proceeds never made it into the estate account, there was nothing left to pay back his debt when it came time to settle the estate.

Cochran sued Mr. Minkin, of course, but he had already spent the money he took from her estate. So the lender also sued Bank of America.

The bank moved to dismiss the lawsuit, arguing that it was not responsible for Mr. Minkin’s misuse of his mother’s estate. In response, Cochran pointed to a provision of the Uniform Commercial Code as it was adopted in California. That law provides that a bank may be liable for allowing an executor to deposit money into his own account if it can be shown that the bank knew that the money did not belong to him or her. Some version of the UCC has been adopted in 48 states, Puerto Rico and the District of Columbia; Arizona’s version is essentially identical to the law as it was adopted in California.

In Mr. Minkin’s case, the proceeds from sale of his mother’s house were in the form of a check made payable to “Ronald Henry Minkin, Executor, Estate of Rose Minkin Sabia, Deceased.” That, ruled the California Court of Appeals, was a pretty clear indication that the bank knew the money did not belong to Mr. Minkin individually.

Bank of America also argued that Cochran should not be permitted to file its lawsuit more than three years after the bank allowed the deposit into the wrong account. The Court of Appeals disagreed, holding that the lawsuit could be filed at any point before three years after Cochran actually learned of the misapplication of money from Mr. Minkin’s mother’s estate. Cochran Investment Co., Inc., v. Bank of America, August 19, 2002.

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Robert B. Fleming


Robert Fleming is a Fellow of both the American College of Trust and Estate Counsel and the National Academy of Elder Law Attorneys. He has been certified as a Specialist in Estate and Trust Law by the State Bar of Arizona‘s Board of Legal Specialization, and he is also a Certified Elder Law Attorney by the National Elder Law Foundation. Robert has a long history of involvement in local, state and national organizations. He is most proud of his instrumental involvement in the Special Needs Alliance, the premier national organization for lawyers dealing with special needs trusts and planning.

Robert has two adult children, two young grandchildren and a wife of over fifty years. He is devoted to all of them. He is also very fond of Rosalind Franklin (his office companion corgi), and his homebound cat Muninn. He just likes people, their pets and their stories.

Elizabeth N.R. Friman


Elizabeth Noble Rollings Friman is a principal and licensed fiduciary at Fleming & Curti, PLC. Elizabeth enjoys estate planning and helping families navigate trust and probate administrations. She is passionate about the fiduciary work that she performs as a trustee, personal representative, guardian, and conservator. Elizabeth works with CPAs, financial professionals, case managers, and medical providers to tailor solutions to complex family challenges. Elizabeth is often called upon to serve as a neutral party so that families can avoid protracted legal conflict. Elizabeth relies on the expertise of her team at Fleming & Curti, and as the Firm approaches its third decade, she is proud of the culture of care and consideration that the Firm embodies. Finding workable solutions to sensitive and complex family challenges is something that Elizabeth and the Fleming & Curti team do well.

Amy F. Matheson


Amy Farrell Matheson has worked as an attorney at Fleming & Curti since 2006. A member of the Southern Arizona Estate Planning Council, she is primarily responsible for estate planning and probate matters.

Amy graduated from Wellesley College with a double major in political science and English. She is an honors graduate of Suffolk University Law School and has been admitted to practice in Arizona, Massachusetts, New York, and the District of Columbia.

Prior to joining Fleming & Curti, Amy worked for American Public Television in Boston, and with the international trade group at White & Case, LLP, in Washington, D.C.

Amy’s husband, Tom, is an astronomer at NOIRLab and the Head of Time Domain Services, whose main project is ANTARES. Sadly, this does not involve actual time travel. Amy’s twin daughters are high school students; Finn, her Irish Red and White Setter, remains a puppy at heart.

Famous people's wills

Matthew M. Mansour


Matthew is a law clerk who recently earned his law degree from the University of Arizona James E. Rogers College of Law. His undergraduate degree is in psychology from the University of California, Santa Barbara. Matthew has had a passion for advocacy in the Tucson community since his time as a law student representative in the Workers’ Rights Clinic. He also has worked in both the Pima County Attorney’s Office and the Pima County Public Defender’s Office. He enjoys playing basketball, caring for his cat, and listening to audiobooks narrated by the authors.