Constructive Trusts: Classic Case of Sharp v. Kowalski


The topic of the PowerPoints for this class lecture is Constructive Trusts. It truly is an intriguing  type of equitable remedy. It certainly does not depend upon the parties’ own intentions – in fact, often, the parties had everything else in mind rather than creating a trust. It is an equitable fiction – designed by the Court to prevent true injustice. When one party wrongfully violates a fiduciary duty or otherwise commits an “equitable fraud” one equitable remedy is simply to declare them an involuntary “trustee” holding property or monies or other tangible assets for the equitable benefit of a victim. We start with a classic New York case, Sharp v. Kosmalski, which is almost a short novel. Only – it was real. A man in his 50s, in a desperate effort to court a woman who was much younger – gave her title to his dairy farm, title to his house, and then first access and finally title to all his bank accounts. When she had obtained everything in the world he owned, she promptly evicted him, leaving him with $300 and nothing else. The tale is in the telling – it is truly an interesting case. We then turn to South Carolina and study some somewhat similar cases – dealing with a breach of confidence when one party entrusted his worldly goods to another.

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