A Delaware court has ruled that Wilmington Trust Company (WTC) breached its fiduciary duty to Wells Lory Hillblom, impacting his inheritance from the estate of Larry Hillblom, founder of DHL. The ruling, issued on July 8, 2026, comes after years of disputes over legal fees related to Hillblom's inheritance, which he received following extensive litigation. This decision could have significant implications for how trustees manage inheritances and communicate with beneficiaries.
The case, Wells Lory Hillblom v. Wilmington Trust Company, C.A. No. 2021-1034-MTZ, centers on a dispute that began when Hillblom, born Nguyen Be Lory in Vietnam, claimed his right to a share of his father's estate after Larry Hillblom was declared legally dead in 1995. After years of legal battles, Hillblom's claim was validated, and a trust was established to manage his inheritance. However, disagreements over how to calculate attorney fees for the lawyers who represented him led to a prolonged conflict between WTC and those attorneys.
The dispute began over the calculation of fees owed to Sanders & Parks, P.C. (S&P), the law firm representing Hillblom during the estate proceedings. S&P argued it was entitled to 30% of the cash distributions from the estate, while WTC contended the fees should be based on the fair market value of the assets at the time they were transferred to the trust. This disagreement continued for nearly two decades, during which WTC failed to take action to resolve the issue or communicate effectively with Hillblom regarding settlement offers.
The case escalated when Hillblom learned about a settlement offer from S&P that WTC had ignored. After settling the claim for significantly more than the ignored offer, Hillblom sued WTC for breaches of trust and fiduciary duty. The trial revealed that WTC had failed to act in Hillblom's best interests and had not communicated crucial information about the settlement offer.
In its ruling, the court found that WTC breached its fiduciary duties by failing to disclose the settlement offer and by not valuing the asset in question. Vice Chancellor Zurn stated, "The trustee breached its duties; and the beneficiary is entitled to damages in the amount by which the settlement exceeded the offer the trustee ignored, as well as his attorneys’ fees in this action." This ruling emphasizes the importance of transparency and communication between trustees and beneficiaries.
The ruling has significant implications for future cases involving trusts and estates. It reinforces the obligation of trustees to act in the best interests of beneficiaries and to communicate openly about important matters. This case may set a precedent for how trustees handle disputes involving legal fees and how they communicate with beneficiaries about potential settlements.
Moving forward, the ruling may prompt other trustees to reassess their communication practices and ensure they are fulfilling their fiduciary duties. It also highlights the need for beneficiaries to be proactive in seeking information about their trusts and to hold trustees accountable for their actions.
As for what’s next, it is unclear whether Wilmington Trust will appeal the decision. The court's ruling could lead to further scrutiny of WTC's practices and may result in changes to how the company manages trusts in the future. There are currently no related cases pending that directly stem from this ruling.