The remedy makes the trust whole by charging the trustee with resulting losses, lost profits, and in self-dealing cases any profit the trustee realized. Interest may be added.
Measurement depends on the breach type.
Alternative Names:
Trustee Surcharge|Fiduciary Surcharge
Why it Matters?
Damages for imprudent investment are measured by what a prudent portfolio would have earned rather than by the nominal loss, which frequently produces a larger figure than the account decline because it captures forgone appreciation. Self-dealing surcharge alternatively disgorges the trustee's profit at the beneficiaries' election. Selecting the more favorable measure is available to the beneficiaries in most jurisdictions.
Frequently Confused with
Related terms
Frequently asked questions
How are investment losses measured?
What alternative applies to self-dealing?
