Should a trustee tell you what is happening in the trust administration? Of course they should, but all too often trustees use information as a weapon and keep their beneficiaries in the dark.
It is easy to spot a good trustee because there is a transparent, free flow of information. Bank statements, brokerage statements, closing documents from selling real estate, property management reports, and future plans for managing and distributing trust assets will all be shared with the beneficiaries. A good trustee knows that sharing information is not just a requirement of the job, but also a great way to keep the beneficiaries comfortable so they don’t freak out.
What makes a bad trustee?
Bad trustees, on the other hand, do the opposite. They hide information, refuse to provide copies of documents, never talk about future investment and distribution plans, refuse requests for information, and refuse requests for distributions. Why all the secrecy? It typically comes down to control and sometimes ignorance. By ignorance, we mean the trustee simply does not know what their duties are so they assume they can do whatever they want. For example, when a child takes over as trustee for a parent, that child may think they can do what the parent did. But there is a big difference between the trust settlor, who has the power to revoke the trust, and the successor trustee who now manages a trust that is irrevocable due to the death of the parent.
While alive, the person holding the power to revoke can do pretty much anything they want with the – including the power to terminate the trust altogether. Whereas the successor trustee does not have that power, and they are therefore subject to stricter fiduciary duties. They must report all relevant information about the trust to the beneficiaries–without the beneficiaries having to ask. They also must reasonably respond to any requests for information from the beneficiaries.
A bad trustee often will use information, and the trust assets, as a weapon against the trust beneficiaries. Instead of being open and transparent, they deny requests, hide information, and generally make everyone’s life miserable. This is all done in an effort to demonstrate that they are in charge and there’s nothing you can do about it. But that’s where the bad trustee is wrong.
There is actually a lot you can do about it. The great thing about the fiduciary duties of a trustee is they are owed to the beneficiary. Whereas a beneficiary owes no duties to a trustee. That means as a beneficiary, you can enforce your rights. That’s not to say that enforcing your rights is easy. You usually must file in court, issue subpoenas, demand documents and other information from the trustee using the discovery process, depose the trustee (which is live questioning with a court reporter) and other relevant witnesses. It can be a lot of work, but with that work you build your case to either remove the trustee, hold the trustee personally liable, or force the trustee to either take action or refrain from acting (if they are trying to do something bad to the trust).
You have rights and you have the ability to enforce those rights in court. It may not be easy, but when you have a bad trustee, you really have no other choice but to take action and stand up for what is rightfully yours. Don’t be kept in the dark.
Is there a trustee keeping you in the dark?
Our attorneys have taken action against hundreds of trustees for abusing their beneficiaries. We’ve also recovered more than $300 million and helped hundreds and hundreds of clients regain their dignity as a trust or will beneficiary through litigation – if you believe you’ve been the victim of inheritance abuse, tell us your story to see if your case qualifies for a free consultation. We’re here to stand, fight and win for you.
Call (877) 408-3813 or reach out online to consult a trust contest lawyer.
