Jeff Lieberman, etc., et al. v. James Sloto, etc.

Summary

The Florida Third District Court of Appeal reversed a sanctions award under Fla. Stat. § 57.105, holding that the word “should” in a trust provision is ordinarily directory, not mandatory, and that the trust protector had sole authority to resolve any ambiguity. The court found the appellants’ position—that “should” was advisory and the trust protector could interpret it—was not so devoid of merit as to warrant sanctions, and that honoring the trust protector’s interpretive authority effectuated the settlor’s intent to avoid court involvement. The decision reinforces that sanctions are improper for non-frivolous arguments based on ambiguous trust language and that trust protectors’ power to clarify ambiguities must be respected.

Holdings

1. The word 'should' in section 4.12 is either unambiguously advisory or, at minimum, ambiguous. Because the Trust Protector had authority under the Trust to resolve ambiguities, the legal position taken was not so devoid of merit to warrant §57.105 sanctions. The trial court's award of sanctions was an abuse of discretion.

Questions Presented

1. Whether the trial court abused its discretion in awarding §57.105 sanctions against appellants when their position—that 'should' in Trust section 4.12 is advisory rather than mandatory—was not so devoid of merit as to warrant sanctions.
2. Whether the word 'should' in Trust section 4.12 is unambiguous and mandatory, or alternatively ambiguous, and if ambiguous, whether the Trust Protector had authority to interpret or clarify it.

Disposition

reversed