California Trust Administration Attorney

California Trust Attorney Explains Trustee Duties and Responsibilities

Trusts are a type of legal document that allows parents and grandparents to protect and distribute assets among family members and loved ones privately, while avoiding probate court. Trusts require that someone, referred to as a trustee, administer the trust. That involves a variety of tasks, including identifying assets, paying debts and making distributions to the beneficiaries.

Generally, the initial trustee is also the person who created the trust, otherwise known as the settlor. As this person ages, they may become unable to continue serving in this role, leaving the administration of the trust to a successor trustee.

Many successor trustees feel that they are in over their heads when it comes to administering a trust because they are new to the role. If you are a trustee, here are three reasons why you should consider working with our trust administration attorneys.

Trusts are a world of their own. The Legacy Lawyers can help you navigate them.

First, trusts consist of their own legal and financial world. Unless you have a legal or financial background specifically related to trusts, you may not understand the rules regarding trust accounting. Unlike businesses, which have profit and loss statements, trusts require accounting for credits and charges, as well as separate schedules that detail each. Trust assets may be held in a complicated manner, and a trustee must properly account for all real property, personal property and financial assets held in the trust. Failing to do so could expose trustees to personal liability.

In addition to understanding the financial ins and outs of trust accounting, it is also important to understand the trust beneficiaries on a personal level. At the end of the day, trusts involve personal relationships with parents, grandparents, siblings and children. Unfortunately, stressed family relationships can come into play when assets are being distributed among beneficiaries. Trustees must maintain working relationships with all beneficiaries, provide appropriate accountings and reports of activity, and also work with beneficiaries to make sure that the trust assets are distributed in a timely and appropriate manner.

The trust administration attorneys at The Legacy Lawyers can help you navigate complex trust administration rules, protect yourself from personal liability and provide guidance regarding potentially complicated family dynamics.

Trustees have legal duties and responsibilities. The Legacy Lawyers can help you meet them.

Second, trustees have a number of duties and responsibilities imposed on them according to California law. These include:

  • The duty of loyalty, which requires a trustee to act in the best interests of the beneficiaries,
  • The duty of disclosure, which requires trustees to disclose material facts to beneficiaries and keep beneficiaries reasonably informed regarding the status of trust assets and actions of the trustee,
  • The duty of impartiality, which requires a trustee to treat each beneficiary equally, without playing favorites, and
  • The duty to enforce and defend claims, which requires a trustee to enforce or defend claims that a prudent trustee would act on, as well as claims that could cause loss to the trust.

Although each duty and responsibility in the administration process may be clear on paper, situations can arise that are difficult to navigate. Having The Legacy Lawyers on speed dial can save you a significant amount of time and trouble when dealing with confidential or time-sensitive information that can impact any of these duties.

The Legacy Lawyers can help avoid liability.

Finally, even if you do your best to follow the terms of the trust and engage all of your professional duties as a trustee, things can and will go wrong. Working with our attorneys will help you minimize the risk when something goes wrong and limit your personal exposure to liability. Trusts mix the financial world with individual members of families, which is an excellent recipe for malpractice suits if feelings are hurt. Trustees have little margin for error, so it is important to be proactive when seeking out personal protection.

Rather than wait until you’ve reached a tricky situation, it makes sense to have an ongoing relationship with the experienced trust administration attorney at The Legacy Lawyers.

This page does not provide legal advice, nor does it establish an attorney-client relationship. To schedule a free consultation with an experienced trust administration lawyer, contact our law firm today.