Candace Louise Curtis v. Anita Kay Brunsting; Does 1-100; Amy Ruth Brunsting

Summary

The Fifth Circuit held that the probate exception to federal diversity jurisdiction did not bar a beneficiary’s claims against co-trustees of an inter vivos trust for alleged breaches of fiduciary duty. Applying Marshall v. Marshall, the court concluded that the trust property was not in the custody of the probate court and reversed the district court’s dismissal for lack of subject-matter jurisdiction.

Holdings

1. After Marshall v. Marshall, the probate exception bars federal jurisdiction only when the action seeks to probate or annul a will or seeks to reach and dispose of property in the custody of a state probate court.
2. The probate exception requires a two-step inquiry: whether the disputed property is estate property within the custody of the probate court and whether the plaintiff's claims would require the federal court to assume in rem jurisdiction over that property.
3. The probate exception did not deprive the federal district court of jurisdiction over Curtis's claims concerning administration of the inter vivos trust.

Questions Presented

1. Whether the probate exception to federal diversity jurisdiction barred Curtis's claims concerning the administration of an inter vivos trust.
2. Whether the trust property was estate property within the custody or in rem jurisdiction of the probate court.
3. Whether the federal district court had subject-matter jurisdiction over Curtis's in personam claims for breach of fiduciary duty and related relief.

Disposition

reversed_and_remanded