Texas Causes of Action & Affirmative Defenses

Texas Causes of Action & Affirmative Defenses

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Saturday, March 1, 2014

The Equitable Remedy of Constructive Trust


What is Constructive Trust as a form of relief in a lawsuit?

CONSTRUCTIVE TRUST DEFINED

A constructive trust is a legal fiction, a creation of equity to prevent a wrongdoer from profiting from her wrongful acts. Procom Energy, L.L.A. v. Roach, 16 S.W.3d 377, 381 (Tex. App.-Tyler 2000, pet. denied). Such trusts are remedial in character and have the broad function of redressing wrong or unjust enrichment in keeping with basic principles of equity and justice. Id.; see also Hubbard v. Shankle, 138 S.W.3d 474, 485 (Tex. App.-Fort Worth 2004, pet. denied).
 
ESSENTIAL ELEMENTS THAT MUST BE SATISFIED TO STAKE CLAIM FOR IMPOSITION OF A CONSTRUCT TRUST
 
To obtain a constructive trust, the proponent must prove (1) the breach of a special trust, fiduciary relationship, or actual fraud, (2) unjust enrichment of the wrongdoer, and (3) tracing to an identifiable res. Troxel v. Bishop, 201 S.W.3d 290, 297 (Tex. App.-Dallas 2006, no pet.); Hubbard, 138 S.W.3d at 485. "`A constructive trust is a relationship with respect to property, subjecting the person by whom the title to the property is held to an equitable duty to convey it to another, on the ground that [her] acquisition or retention of the property is wrongful and that [she] would be unjustly enriched if [she] were permitted to retain the property.'" Baker Botts, L.L.P. v. Cailloux, 224 S.W.3d 723, 736 (Tex. App.-San Antonio 2007, pet. denied) (quoting Talley v. Howsley, 176 S.W.2d 158, 160 (Tex. 1943)).

SOURCE: SAN ANTONIO COURT OF APPEALS – No. 06-13-00043-CV – 2/20/2014
 
 

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