In a recent case in the Delaware Court of Chancery involving a suit between the trustee of a trust and the trust’s beneficiaries, Vice Chancellor J. Travis Laster had to decide whether the beneficiaries could get access to documents that the trustee claimed were protected from disclosure by the attorney-client privilege. In so doing, the vice chancellor considered and rejected the argument that an amendment to the Delaware Decedents’ Estates and Fiduciary Relations law in 2015 overruled prior precedent regarding the fiduciary exception to the attorney-client privilege.

In J.P. Morgan Trust Co. of Delaware, Trustee v. Fisher, C.A. No. 12894-VCL (Del. Ch. Dec. 5, 2019), the trustee of a trust sued the trust’s beneficiaries for a declaration that the trustee had complied with its legal and equitable duties in all respects. The suit followed the trustee’s acceptance of a cash buyout proposal that the beneficiaries had opposed because it would result in a significant tax burden on the trust that the beneficiaries thought could be avoided if the transaction were structured differently. In contesting the trustee’s lawsuit, the beneficiaries contended that the trustee had accepted the cash buyout because of its own conflicts of interest.