A Responsibilities of Trustee Generally

• Library: Foreclosures Guidebook (2017 Ed.)

A. Responsibilities of Trustee Generally

The trustee in a deed of trust is considered to be in a fiduciary relationship to both the mortgagor and the mortgagee. Smith v. Haley, 314 S.W.2d 909 (Mo. 1958); see alsoSpires v. Edgar, 513 S.W.2d 372, 379 (Mo. banc 1974). The trustee should not become the purchaser, even indirectly, at the foreclosure sale. Jackson v. Klein, 320 S.W.2d 553 (Mo. 1959). But the use of an employee of the mortgagee as the trustee has been upheld. Judah v. Pitts, 62 S.W.2d 715 (Mo. 1933). Although acknowledging that it found “very little law on the subject,” one court has decided that the trustee was not guilty of wrongdoing in announcing the bid offered by the foreclosing mortgagee. Boatmen’s Bank of Jefferson Cnty. v. Cmty. Interiors, Inc., 721 S.W.2d 72, 77 (Mo. App. E.D. 1986). That case can also stand for the proposition that the trustee can accept (and announce at the sale) a bid...