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- Title
PLAN ASSETS--COLLECTING CONTRIBUTIONS.
- Abstract
The article reports that the Secretary of the Department of Labor brought suit in the United States District Court for the Eastern District of Michigan, Northern Division against the Hosking Geophysical Corp. Employees Profit Sharing Plan and three plan fiduciaries and trustees for breach-of-fiduciary duty arising out of loans from the plan to the company sponsoring it, loans from the plan to participants, and the failure to maintain a bond for the plan. The case was decided on plaintiff's motion for summary judgment and primarily involved issues with respect to one trustee, Johnson, who argued that he deserved a trial on the merits to determine whether he was a fiduciary and whether he breached his fiduciary duties as a trustee of the plan. A fiduciary cannot delegate all responsibility for investment decisions because he has a duty to apprise himself of the plan's investments and loans and to reasonably assure himself that the investments were prudent and legal. Participant contributions are plan assets, and the responsible fiduciaries are required to take remedial steps to recover the assets. A trustee is entitled to rely upon the person in an organization with the greatest expertise without breaching his fiduciary duty. Plan fiduciaries are personally liable for breach-of-fiduciary duty
- Subjects
UNITED States; ACTIONS &; defenses (Law); FIDUCIARY accounting; TRUSTS &; trustees; LEGAL judgments; CORPORATE profits; INVESTMENTS
- Publication
Benefits Quarterly, 1997, Vol 13, Issue 3, p104
- ISSN
8756-1263
- Publication type
Article