The pleasantly named Baker Boyer National Bank held some liquid assets and 846 acres of farmland in a trust for the benefit of successive generations of the Garver family. The bank put the $194,000 of liquid assets into municipal bonds. This was during the period 1973 to 1982, when interest rates rose to record levels. This caused the bonds to decrease in value. They were ultimately sold at a loss of $63,750 (ouch!).
The Garvers sued the bank for failing to diversify the trust's holdings, and the trial court awarded the family $22,950 in damages. These were computed by comparing the municipal bond outcome, with what would have occurred if 40% of the portfolio had been in stocks. The bank appealed.