Abruzzo trustee ordered to pay $250,000
Kearney to repay wife’s trust, family
Mary Pat Abruzzo died suddenly at the age of 31, leaving a husband whose bid for control and more money from her family trusts has upended her family, harmed the trust, and left him owing nearly $1 million in court-ordered damages, fees and sanctions so far, according to a new ruling.
State District Judge Alan Malott of Albuquerque ruled July 7 in favor of counterclaims filed by Abruzzo’s brothers, Louis and Benjamin, and other family members against Victor Kearney, Mary Pat Abruzzo’s spouse of eight years.
In imposing about $250,000 in damages, Malott criticized Kearney for “self-dealing with third parties, improper disclosures of financial information and repeatedly breaching his duty as a trustee” of two trusts his wife set up in 1988. She died in 1997 on a cruise off the coast of Mexico. They had no children. Kearney is a beneficiary of the trust for the remainder of his lifetime.
Previous testimony in the four-year-old case showed that Kearney’s income from the trust had gone from about $102,000 in 1999 to $900,000 in 2014 as the Abruzzo brothers consolidated their business holdings in Alvarado Realty Co., or ARCO, which owns properties including Sandia Peak Tramway, Sandia Peak Ski Area, Ski Santa Fe and Hoffmantown Shopping Center.
But Malott ruled that “clear and convincing evidence exists that Victor Kearney is unable to successfully manage his financial life on the trust distributions he receives and is significantly in debt.”’
Mallot’s ruling cited several attempts by Kearney to leverage his future trust distributions with creditors, including discussing outsiders’ purchase of the trust shares in ARCO without disclosure to the other family beneficiaries.
For instance, Kearney disclosed confidential documents to one of his creditors, whom he owed about $2 million, for a takeover bid, Malott wrote. Those who received the confidential information, in turn provided some or all of it to at least 28 other persons and entities, the ruling stated.
Kearney’s financial difficulties, Malott wrote, “arise not from illness, accident or even bad luck, but arise from a pattern of his own choices and this pattern is likely to continue.”
Pat Rogers and Angelo Artuso, attorneys for the Abruzzo family, said Monday, “The Abruzzo family is grateful for the opportunity to put this chapter behind them.”
Kearney’s attorney Pete Domenici Jr. told the Journal his client was required to address the counterclaims in the case before he could appeal earlier rulings by Malott. “He looks forward to having a higher court take a look at the issues raised by this case,” Domenici said.
Malott assessed damages to the trust at $166,478, to be paid to the trust from Kearney’s future distributions. The Abruzzo brothers and the remainder beneficiaries were awarded a total of about $85,000 for damages to their privacy interests caused by “Kearney’s improper dissemination of personal information and trust income assets and operations,” the ruling stated.
Kearney was previously assessed about $630,000 in attorneys fees and costs and a $100,000 sanction for disobeying a confidentiality order. Kearney first initiated the litigation in 2013, accusing the Abruzzo brothers of breach of trust.