United States District Court, E.D. Virginia, Alexandria Division
MARY ANNE KIRGAN and ROBERT S. KIRGAN, Plaintiffs,
MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, Defendant
M. HILTON UNITED STATES DISTRICT JUDGE.
MATTER comes before the Court on Plaintiffs Mary Anne Kirgan
and Robert S. Kirgans' Complaint, as successor trustees
to the Plitt Trust, seeking to remove M&T as the
corporate co-trustee of the Clarence Manger and Audrey
Cordero Plitt Trust (the "Trust"). Plaintiffs seek
a declaratory judgment for removal of Defendants as corporate
trustee and also bring a claim for breach of fiduciary duty.
Defendants also seek declaratory judgment on a number of
issues against Plaintiffs in addition to a breach of
fiduciary duty claim.
filed their complaint in this Court on March 21, 2017,
alleging four counts against Defendants. Plaintiffs amended
their complaint on August 29, 2017, bringing five counts
against Defendants. Plaintiffs brought Count I Declaratory
Judgment for Plaintiffs Right to Change the Corporate
Trustee, Count II Removal of M&T Bank as Corporate
Trustee, Count III Breach of Contract, Count IV Breach of
Fiduciary Duty, and Count V Fraud.
to trial, the Court granted summary judgment for M&T on
the Kirgans Count III (breach of contract) and Count V
(fraud). The Court also ruled that based on the 1985 Order
from the Circuit Court for Baltimore City, M&T could only
be removed for cause. This ruling dismissed Count I. This
left only Counts II and IV and the Counterclaims for the
Court to decide at trial. This Court began a bench trial on
February 21, 2018, which continued until February 22, 2018.
Findings of Fact
on the evidence adduced at trial, the Court makes the
following findings of fact.
Plitt Trust is a testamentary charitable trust created by the
Last Will and Testament of Clarence Manger Plitt (the
"Will"). Mr. Plitt signed the Will in 1976 and died
four months later.
Prior to his death, Mr. Plitt lived with his long-time
partner, Mary E. Mc.C. Kirgan ("Mary Kirgan"), and
her children Plaintiffs Mary Anne Kirgan and Robert Kirgan.
Clarence Plitt raised Mary Anne and Robert beginning from the
ages of 5 and 10 respectively. Although Mr. Plitt and Mary
Kirgan never married, the Kirgan children considered Mr.
Plitt to be their stepfather. The Kirgans spent considerable
time with Mr. Plitt during his life.
During the time Mr. Plitt lived in Mary Kirgan's home, he
spoke of his intentions for the Trust and his philosophy of
charitable giving. He wanted to set up a trust that donated
money to educational institutions specifically to provide
students with loans.
Will provided that "the original Trustees of this trust
shall be the First National Bank of Maryland and Mary E. McC.
Kirgan, if living."
After Mary Kirgan died the Will provided that she be
succeeded by two individual co-trustees. When Mary Kirgan
passed away in 2004, Robert and Mary Anne Kirgan became the
successor individual co-trustees of the Plitt Trust.
corporate trustee First National Bank of Maryland was
acquired by M&T Bank. M&T is based in New York.
Following Mr. Plitt's death, Mary E. McC. Kirgan, one of
the original named trustees in the Will, contested the Will.
The Will was probated in Maryland. The Maryland Court issued
an order that M&T Bank could only be removed for cause.
Trust awards funds to educational institutions that agree to
use the funds for student loans.
Will requires the trustees to distribute the entire net
income generated by the trust at periodical intervals no less
frequent than annually unto and among educational
institutions as they shall from time to time select and
determine in the respective proportions among such
institutions as the trustees shall determine.
Will establishes requirements for distribution of funds from
the Plitt Trust to educational institutions for school loans.
Specifically, the Will requires funds from the Plitt Trust to
be used by educational institutions to make loans to
deserving secondary school, college or graduate students, who
by reason of poor or less than ample family financial
circumstances, need monetary assistance to embark upon or
continue their education. Selected educational institutions
must agree to use funds received from the Plitt Trust in
accordance with the terms of the Will.
Will identifies considerations that are left to the
discretion of educational institutions that receive funds
from the Plitt Trust. For example, the selection of students,
loan amounts, repayment dates, and other terms and conditions
pertaining to loans shall be determined from time to time
solely by the respective educational institutions(s),
provided that the standards and criteria employed in making
such determinations shall not discriminate against any
particular type or category of student.
Will precludes the Plitt Trust from having any right, claim
or interest of any kind in any interest or principal
repayment emanating from loans made by the respective
educational institutions. Instead, to be used by respective
lending educational institutions for such specific uses in
furtherance of their educational purpose as they shall desire
from time to time.
Will prohibited any payments or contributions from the income
of the trust except in furtherance of charitable, religious,
scientific, literary or other educational purposes. However,
payments of trustees' commissions, expenses, and all
other charges or costs reasonably incurred from time to time
in connection with the administration of the Plitt Trust were
to be deemed in furtherance of said purposes.
Plitt prepared a Memorandum that accompanied the Will that
discussed his personal philosophy; however, he acknowledged
that the trustees need not look beyond the four corners of
the Will instrument and that the Memorandum was not intended
to be binding in any legal sense on the trustees.
Kenneth Hornstein, an employee of First National Bank of
Maryland (and later M&T) from 1990 until March 2011, was
the Trust officer who oversaw the responsibilities for the
Plitt Trust. He worked with Mary E. McC. Kirgan, who was then
the individual trustee. When Mary E. McC. Kirgan died in
2004, Mary Anne Kirgan and Robert Kirgan became the successor
individual trustees by appointment. The trustees oversaw and
issued school loan contracts on behalf of the Trust.
the early years of the Trust's existence, the trustees
established a protocol by which the Trust carried out its
charitable giving. Each year, the individual trustee selected
the educational institutions that would receive the
Trust's grants and the amount of grant that each
institution would receive. One or all of the trustees then
wrote the contracts between the Trust and the school that
bound the institution to use the received funds in accordance
with the Will. The ...