When a trust has been executed in a foreign jurisdiction by a settlor who subsequently becomes a resident of Florida, such a trust will often recite that the law of the foreign jurisdiction controls. The fact that a resident decedent leaves little or no property in the state is not necessarily a bar to administering the decedent’s estate in Florida. A domiciliary administration could be established in Florida, and the property could be administered where it is located under ancillary proceedings. However, section 736.0205, Florida Statutes, provides that if a party objects, the court shall not entertain trust proceedings under section 736.0201, Florida Statutes, for a trust registered, or having its principle place of administration, in another state, except under limited circumstances. These circumstances include situations in which all interested parties could not legally be bound by litigation in the courts of the foreign state where the trust is registered or has its principle place of administration. Fla. Stat. § 736.0205. Furthermore, the court may condition a stay or dismissal of a foreign trust proceeding on the consent of any party to jurisdiction of the state where the trust is registered or has its principle place of business. Id. The court may also grant a continuance or enter any other appropriate order. Id.
Nevertheless, the First District Court of Appeal in In re Estate of McMillian, 603 So. 2d 685 (Fla. 1 st DCA 1992), specifically considered section 736.0205, Florida Statutes (formally section 737.203, Florida Statutes), and held that the statute does not require a Florida court to decline adjudication of a foreign trust. In McMillian, Opal McMillian executed a will in Cincinnati, Ohio by which she left her residual estate to a trust explicitly governed by the laws of Kentucky. 603 So. 2d at 686. Almost ten years later, Opal died in Tallahassee, Florida, and her will was admitted to probate in Franklin County, Florida. Id. at 687. In response to a trust petition, a beneficiary under the trust filed a motion to dismiss, alleging that the Florida court lacked jurisdiction over the trust. Relying on section 732.0205, Florida Statutes, the Court concluded:
This statute is not a jurisdictional bar. It is more in the nature of a venue statute, and speaks in terms of whether a Florida court will “entertain” trust proceedings. The statute further does not seem to require the judge to dismiss a case, even after the statutory provision is invoked . . . . The comments on the drafters of the Uniform Probate Code, accompanying section 7-203, which is materially similar to our section [732.0205], indicate:
It is assumed under this section a court would refuse to entertain litigation involving a foreign registered trust unless for jurisdictional or other reasons, such as the nature and location of the property or unusual interests of the parties, it is manifest that substantial injustice would result if the parties were referred to the court of registration . . . . [T]he issue is essentially only one of forum non conveniens in having litigation proceed in the most appropriate forum. This is the function of this section.
Id. at 688. Yet, in McMillian, the trust was to be funded with Florida estate assets, and the identification of the trust beneficiaries was governed by Florida law. Thus, the First District Court of Appeal’s decision in that case may have been different if no Florida estate was involved or if the objection was made by the foreign trustee. See also, e.g., Levine v. Steiger, 765 So. 2d 249 (Fla. 4th DCA 2000) (explicitly agreeing that section 732.0205 is “not jurisdictional, but rather has the purpose of having trust litigation proceed in the most appropriate forum.”).
For these reasons, it is important to create an estate plan that both reflects your desires for the disposition of your assets upon your death and also complies with the trust laws of your state. If you or someone you know has recently moved to Florida, or if you recently lost a loved one and are unsure of your rights under Florida law, please do not hesitate to contact the attorneys at Chepenik Trushin LLP, who are experienced in both estate planning and probate administration.