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Trustees must give reasonable bond notice when silence unfairly defeats beneficiary rights.
The appeal addressed whether a trustee under a labour and material payment bond must disclose the bond’s existence to potential beneficiaries.
A majority held that where non-disclosure would unreasonably disadvantage a beneficiary, fiduciary duties require reasonable notice steps.
Because the contractor did nothing to alert subcontractors in circumstances where such bonds were uncommon, it breached trust obligations, and the case was remitted for damages quantification.
