Sometimes the trustee fails to carry out his duties or abuses his position, and beneficiaries worry that the system the settlor created is on the verge of collapse, or that they will be denied the funds due to them.
This problem can occur simply because being a trustee is terribly difficult. Piles of paperwork, property management chores, and the responsibility to invest assets can be overwhelming. Many trustees are not prepared for the role. A trustee may never have asked for the position but feels bound to keep it, having been personally chosen by the settlor.
The situation becomes even more complicated when a trustee has a personal stake in the trust, which could lead him to withhold funds from beneficiaries.
However, certain legal checks prevent the trustee from abusing his position. A trustee cannot do whatever he wants; he is bound by his fiduciary duty. This means the legal responsibility of a trustee to act reasonably on the behalf of the beneficiaries.
Trustees must also keep beneficiaries informed about what is happening with the estate by issuing a periodic accounting.
In fact, if you are having trouble with a frustrating trustee, request an accounting to begin resolving the situation.
Another option is to ask the trustee to step down and give the position to someone else. He may refuse, but he could be so overwhelmed with duties, he no longer wants the role; surrendering the job might be a relief for him, especially since trustees are not always paid for their hard work.
Usually, the trust document specifies one or more successor trustees as back-up in case the first trustee is unable to do the job; this can smooth the transition.
However, before you begin to unseat the trustee, ask yourself if the settlor had a good reason to place him in the role. Even if you don’t change your mind, at least consider that the settler thought that the trustee was the best person to serve your interests. Unless he is abusing his role, you may want to keep him.
In cases where the trusteeship has severely gone wrong, you can hire an attorney and sue the trustee for damage.
However, be careful. Asking a trustee to step down or filing a lawsuit can be emotionally taxing; it can do irreversible damage to relationships. Always keep your primary purpose in sight. Avoid acting rashly and try, as much as possible, to set your anger aside.
If you are struggling with an inadequate or frustrating trustee, hire expert legal assistance. Call the Law Office of Richard Nevins for a consultation and fill out our form before you come in. We will evaluate your situation and apply our expert knowledge to find a solution.