What to Do When a Trustee Is Not Behaving as Expected


Trust disputes can be both difficult and emotional. When you entrust your assets to another person or entity, you expect them to behave professionally and to act in your best interests. The unfortunate reality is that many people who are appointed to be trustees of trusts believe that they can do whatever they want. In their minds, they are in charge. However, that’s not true. Under California Probate Code, several laws govern trusts, and all trust documents require trustees to undertake tasks for beneficiaries. When that Trust is violated, it can lead to frustration and confusion.

Trusts are an important part of estate planning and asset protection, but when a trustee is not acting as expected, it can cause significant disruptions. In these types of trust disputes, it is essential to act quickly. If you think that a trustee has not been behaving properly, there are several steps you can take to address the issue:

1. Review the trust documents:

The first step in any trust dispute is to carefully review the trust documents. The trust documents, such as the trust declaration or the will that creates the trust, set out the terms and conditions of the trust—including the trustee’s duties and powers. Understanding the terms of the trust can help the beneficiary determine if the trustee is behaving appropriately.

2. Communicate with the trustee:

If the beneficiary believes the trustee is not behaving as expected, they should communicate their concerns to the trustee. This communication can take the form of a face-to-face meeting, a letter, or an email. The beneficiary should explain their concerns and provide any evidence or documentation to support their position. The trustee may be able to provide a satisfactory explanation or address the beneficiary’s concerns.

3. Seek mediation:

If the beneficiary and the trustee are unable to resolve the dispute on their own, they may want to consider mediation. Mediation is a process where a neutral third party helps the disputing parties reach a mutually acceptable resolution. Mediation can be less expensive and less time-consuming than going to court, and it can help preserve the relationship between the beneficiary and the trustee.

4. File a lawsuit:

If the dispute cannot be resolved through mediation or other means, the beneficiary may need to file a lawsuit against the trustee. In California, these lawsuits are usually called “Petitions” to the probate department of the correct superior court.  In a trust lawsuit, the beneficiary will need to prove that the trustee breached their fiduciary duty or violated the terms of the trust. If the beneficiary is successful, the court may order the trustee to take certain actions, such as returning trust property or compensating the beneficiary for any losses.  The court may also remove the trustee.

5. Act Quickly to Determine Your Rights:

In California, you may have as few as sixty days to challenge the terms of a trust.  If you receive a notice from a trustee, or an accounting of income, expenses and assets of the trust, you will have a limited amount of time to challenge those.  If you have a claim against an estate or a trustee, you may lose it unless you file before the applicable statute of limitations expires.

CONCLUSION: Trust disputes can be difficult—understanding what steps need to be taken when an individual or entity violates their fiduciary duty is critical in protecting yourself and any assets involved. At Hamlin | Cody, we are here to help you develop a strategy to get the best result. Give our attorneys a call today if you feel like you’re being taken advantage of by someone who holds power over your assets.

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