Which remedies are available for breach of trust?

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Multiple Choice

Which remedies are available for breach of trust?

When a trustee breaches trust, courts use equitable remedies to restore what’s owed and prevent unjust enrichment. A constructive trust is imposed when property is misappropriated or wrongfully held; the property is treated as held for the beneficiary, so the trustee must transfer it or its value back. An equitable lien arises to secure repayment or reimbursement from the misused assets, giving the beneficiary a secured claim on the property or its proceeds. A purchase-money resulting trust can occur when the beneficiary provides funds to buy property in the trustee’s name; the property is held on a resulting trust for the beneficiary to the extent of those funds. Because each of these remedies can be available in breach-of-trust situations, all of the above is the correct overall answer.

When a trustee breaches trust, courts use equitable remedies to restore what’s owed and prevent unjust enrichment. A constructive trust is imposed when property is misappropriated or wrongfully held; the property is treated as held for the beneficiary, so the trustee must transfer it or its value back. An equitable lien arises to secure repayment or reimbursement from the misused assets, giving the beneficiary a secured claim on the property or its proceeds. A purchase-money resulting trust can occur when the beneficiary provides funds to buy property in the trustee’s name; the property is held on a resulting trust for the beneficiary to the extent of those funds. Because each of these remedies can be available in breach-of-trust situations, all of the above is the correct overall answer.

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