A Commitment

to Each Client.

3 reasons you may need to challenge a trustee’s position

Whether the goal is to provide for multiple generations or arrange for remaining assets to go to a charity, a trust can be a valuable tool. Unfortunately, sometimes the person creating the trust doesn’t do a good job of selecting their trustee.

Picking the wrong trustee could mean diminished resources for beneficiaries or even the loss of crucial assets. If you are a beneficiary of a trust, you may need to challenge the trustee if any of the three situations reflect your own circumstances.

You suspect that the trustee uses assets for personal gain

A trustee has a fiduciary duty to the beneficiaries of an estate. They should put its best interests above their own and try to protect and maximize the value of the assets in the trust. A trustee might embezzle from the trust or sell trust assets to their friends or family for ridiculously low prices. They could also hire people they know to do services for the trust, possibly at inappropriate rates.

They don’t comply with the rules of the trust

Perhaps the trustee has been tasked with tracking withdrawals by each beneficiary to make sure that everyone receives relatively equal amounts, but they have clearly been distributing more to one person. Maybe they should pay certain bills directly but delegated the job to someone who is irresponsible. When a trustee does not follow the instructions for the distribution or use of the assets, you may have grounds to challenge them.

They keep failing to do what is necessary

Maybe you received notice that the trustee failed to pay the property taxes on a piece of real estate helped by the trust. Maybe they don’t respond to requests from beneficiaries who need assets for college or other approved purposes. When a trustee simply doesn’t have the time or dedication to follow through with their responsibilities, beneficiaries may need to challenge them so that someone else can take their role.

If you feel like trust litigation is in your immediate future, documenting your concerns carefully can be an important step toward protecting your interest in a trust.

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