File A Petition It may take filing a petition in probate court to get funds distributed from your trust. You must petition the court and the judge know you need money living expenses.
Full Answer
Trust beneficiaries worried about a trustee raiding the fund for legal fees have a few options: Trustees have the legal freedom to use money from the trust for necessary expenses in administering the trust. These include legal fees to protect the trust against malicious litigants.
If you become successful in litigation, you may be right to assume that the unsuccessful party will reimburse legal fees or that trust assets will be used for attorney fees. Disputes between beneficiaries or trustees may result from misunderstanding or contravention of the terms of a trust.
A beneficiary recovered legal fees from a trustee who unfairly withheld distribution if the court finds the trustee’s conduct unreasonable or malicious. Estate of Ivey, (1994) 22 Cal.App.4th 873: This case involved a beneficiary who objected to a trustee’s accounting who made frivolous and fraudulent objections.
But if, as a trustee, you are unsuccessful in defending claims such as breach of fiduciary, the courts may decide that it was improper to take your legal fees from the trust. You will have to reimburse it.
Generally, no you cannot sue a trust directly. Again, that's because a trust is a legal entity, not a person. It's possible, however, to sue the trustee of a trust whether that trust is revocable or irrevocable. As mentioned, in the case of a creditor lawsuit the trustee of a revocable living trust could be sued.
Trustees must follow the terms of the trust and are accountable to the beneficiaries for their actions. They may be held personally liable if they: Are found to be self-dealing, or using trust assets for their own benefit. Cause damage to a third party to the same extent as if the property was their own.
A trustee cannot lie about anything related to the trust. A trustee cannot provide false information to the beneficiaries or the court. For example, when a beneficiary asks about something relating to the trust, the trustee must answer truthfully.
Typically when a trust is sued, a trustee is authorized to use trust funds to defend the lawsuit. This may happen even when it is the trustee himself who is being sued.
When a trust breach occurs, a probate court can impose serious consequences and penalties, including suspension or removal as trustee or being surcharged – probate for being ordered to pay money – for damages caused by the breach. In rare and extreme cases, trustees can even face criminal charges.
A living trust does not protect your assets from a lawsuit. Living trusts are revocable, meaning you remain in control of the assets and you are the legal owner until your death. Because you legally still own these assets, someone who wins a verdict against you can likely gain access to these assets.
The trustee usually has the power to retain trust property, reinvest trust property or, with or without court authorization, sell, convey, exchange, partition, and divide trust property. Typically the trustee will have the power to manage, control, improve, and maintain all real and personal trust property.
In the case of ignoring the beneficiary, the court intervention could be enough to prod the Trustee to action. If an unresponsive trustee has demonstrated animosity toward the beneficiary that results in unreasonable refusal to distribute assets or has a conflict of interest, the court may remove the Trustee.
Main Duties Of A TrusteeDuty to the terms. A trustee must know and adhere to the terms of the trust which are prescribed by the trust deed.Duty of loyalty. Trustees have a fiduciary duty towards beneficiaries. ... Duty to manage the trust efficiently. ... Duty to act personally. ... Duty to consider the beneficiaries. ... Duty to account.
In general, a beneficiary under a trust can assign his interest under it. If he does so, the assignee can sue the trustee for a breach of trust committed before the assignment: Scott on Trusts , ss. 132-132.2.
Breach of trust refers to any type of intentional or negligent, self-serving, erroneous, or retaliatory conduct committed by the trustee of a trust, resulting in harm to trust assets or beneficiaries. Misappropriation is a broad term encompassing many different types of offenses, both intentional and unintentional.
A conflict of interest for a trustee occurs when the trustee's personal interests potentially conflict with their responsibilities to the trust beneficiaries.
I agree with all of my colleagues. It also strikes me as possible, however, that there was never a trust, in the first place. It is possible that your brother was simply named as a joint tenant or beneficiary of your mom's assets. That would explain why you were never notified of the administration and not provided with a copy of the paperwork.
It is unlikely that the trust was drafted without an attorney. It is however possible that the trust was administered without the help of an attorney. You should speak with a probate attorney to discuss the situation in detail. They will be able to look at both the estate and the trust. Good luck...
I am not in your State but this is something you will need an attorney for.
You are entitled to a copy of the trust and an accounting of the assets and expenses. It appears you will not be able to obtain this on your own-so-you will need an attorney to make the demand and take action.
To create the trust you’ll need a trust establishment date, the date on which the trust becomes active and legally binding. You’ll also need to list the trust’s beneficiaries, those who you wish to serve as trustees of the trust and oversee the administration of the trust, and a list of your assets being placed into the trust.
With an irrevocable trust you’ll need the agreement of the beneficiaries as well as the trustees to make any changes, whereas a revocable trust is dissolvable with the issuance of a letter of revocation, allowing more leeway in making any modifications necessary. Fill out the templates with the necessary information.
As part of trust administration, the trustee must properly settle the trust (notifying creditors, paying taxes, etc.) Once it has completed its purpose and then the trustee can complete the paperwork to dissolve the trust. Learn more about the distribution of trust assets to beneficiaries. Elissa Suh.
The reasons the court might permit you to revoke an irrevocable trust include: the trust’s purposes have been fulfilled or have otherwise become illegal, impossible, impractical to carry out, or uneconomic (the cost of maintaining it exceeds the value of trust property).
By definition, a revocable trust can be dissolved or closed by the grantor ( also known as the settlor or trustor). This flexibility is what makes a revocable trust a useful component of an estate plan. If you’ve created a revocable living trust, these are the steps you can take to dissolve it: Remove assets from the trust.
For example, if your trust beneficiary dies, it may be easier to revoke rather than amend the trust. This article is primarily about how a grantor can revoke their trust; it does not cover how a trustee can close or settle a trust as part of trust administration after the grantor’s death.
You can dissolve an irrevocable trust only under the circumstances set out in your state’s trust law, which commonly include getting permission from all beneficiaries as well as a court. The difficulty of dissolving an irrevocable trust will depend on your state law.
An attorney or trustee cannot revoke your trust (unless you have permitted them to do so in the trust agreement). A grantor might want to revoke their trust if it no longer serves its purpose or if it requires substantial changes that are not worthwhile to make.
The petitioner can attempt to do this while the grantor is still alive, or after the grantor’s death. (All trusts become irrevocable after the grantor’s death because they can no longer change it; testamentary trusts, created through a will, are also irrevocable.)
Trust funds are separate legal entities that can hold property, money, stocks, or even businesses as assets. Trust funds can be set up for various reasons but are typically utilized as estate-planning tools benefiting individuals, an organization, or future generations.
Trust funds generally fall into two categories: those in effect while you are alive and those enacted after you have passed away. Trusts can be revocable or irrevocable. Revocable trusts can be changed or dissolved by the grantor while alive.
Trust funds can have many benefits for grantors and beneficiaries. Above all, setting up one or several trusts can ensure that your estate is distributed as you see fit, whether to your family, loved ones, or any charities you wish to support. Other notable benefits include:
You could potentially create a trust fund on your own. However, there can be pitfalls with the do-it-yourself approach. A minor mistake on the document could invalidate your trust. Moreover, when funds are not adequately allocated, a trust could be useless for the beneficiaries.
While estate planning may not be the most preferred topic of choice for small talk, consider asking friends and family members for attorney referrals. You could also search online databases such as Avvo and Martindale for estate and trust fund attorneys.
A trust fund attorney can assist with estate planning needs and set up the necessary paperwork to create a trust fund. Trusts can help your family receive their inheritance promptly by avoiding probate and potentially reduce the tax burden.
It seems that most of us would rather avoid thinking about estate planning and making provisions for our passing. A survey by the American Association for Retired Persons (AARP) revealed that a staggering 6 out of 10 Americans have no estate planning documents at all, not even a simple will.
You did not share with us what the terms of the trust are. If she was permanently disabled and unable to care for herself or make her own decisions as result of the accident then there is a possibility that her age does not matter. Otherwise it is likely that the funds are held until she is 18.
First of all, I'm sorry to hear about the accident and that it caused your daughter to be disabled. The terms of the trust are probably that she can access the trust when she is 18 (if she was a minor at the time of the accident).
Whether a trust fund can be cashed out depends on its terms. You should take the trust documents to a probate lawyer for review. If the trust fund is in fact a structured settlement, I would caution you in the strongest terms not to cash it out. You will get less than half what it is worth.
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A trust could also be contested due to the incapacity of the person creating the trust.
Before taking your case to court, you may want to consider mediation, which is often a less costly way to resolve disputes. Mediation also both parties to discuss the problems and come to a solution without involving the courts. An experienced mediator or estate planning lawyer could be consulted to facilitate the discussion. Arbitration is another option for those who are seeking justice.