A trust is an entity created by a legal document. It is used to hold assets including cash, stocks, real estate, and other property. It’s formed by a Settlor who transfers part or all of his property into the trust. The trust holds the title to the property and the trust is managed by a trustee. The trustee is responsible for managing the trust for the beneficiaries. Trusts can be a very effective way to plan an estate without needing to worry about probate issues.
When a trust is properly executed and properly managed, it can be a great vehicle that makes managing end of life finances much easier and subject to fewer problems. When a trust is not properly executed, uses imprecise language, or is financially mismanaged, a myriad of trust disputes can arise. It takes a knowledgeable trust dispute attorney to wade through the issues and ensure that beneficiaries get fair treatment.
Trust disputes come in several different varieties. The disputes usually focus on a lapse of fiduciary duty by the trustee, but trust language can also sometimes lead to disputes. If a beneficiary suffers from any of these issues, they have a right to be properly compensated for their losses.
The trustee has a fiduciary responsibility to properly manage the financial affairs of the trust. Trustees have a fiduciary responsibility to the beneficiary and when this fiduciary duty is not maintained, beneficiaries have a right and an obligation to dispute the trust.
Fiduciary duties fall into three duty areas. The duty of Loyalty means that a trustee must put the interests of the trust before their own. The duty of Disclosure means that a trustee must disclose to the beneficiaries as much information about the trust as possible, including its investments and its accounts. The duty of Reasonable Care means that the trustee must manage the trust as well as a prudent and reasonable person would manage their own personal financial affairs.
If a trust is not properly executed, there can be misunderstandings about how the trust is supposed to be managed. This can be particularly difficult after the Settlor has passed away and is unable to be consulted about his true intentions. Even if his true intentions are known, it can still lead to disputes when the law is not properly followed. The trust may have illegal conditions on the trustee or the beneficiaries. A trust dispute attorney can evaluate the trust documents to ensure that it is fair to the beneficiaries.
If you have trust dispute or need to know if you are the victim of a breach of fiduciary duty, then you need to contact a knowledgeable trust dispute attorney. The trust litigation attorneys at Temmerman, Cilley & Kohlmann are experienced in all facets of estate planning, including trust disputes.