When there are only two co-trustees and they cannot agree, either co-trustee can file a petition with the court to ask the court to make the decision in the best interest of the beneficiaries to whom the trustees have a fiduciary duty.
Whether it's choosing to sell a family home or deciding how much money should be distributed to a beneficiary, both co-trustees have equal authority, and both must be on the same page.
Where the duty of unanimity is not modified, and trustees cannot agree, then they will not be able to give effect to any proposed course of action. In these circumstances the trustees' options may be: to abstain from effecting the proposed course of action in question.
Disagreements tend to end up in court with co-trustees suing each other. In addition, disagreements tend to disrupt the purpose of the trust. Lost time and cost over disagreements escalate tensions. Arguments and disagreements cause issues that the grantor wanted to avoid by appointing co-trustees.
And when co-trustees are appointed, trustees not only have the ability to contest certain aspects of a trust, they may have the duty to do so. Specifically, if one co-trustee concludes that the other co-trustee(s) are breaching their duties, they have the obligation to take legal action against their co-trustee.
Can a Trustee Change the Beneficiary? Trustees generally do not have the power to change the beneficiary of a trust. The right to add and remove beneficiaries is a power reserved for the settlor of the trust; when the grantor dies, their trust will usually become irrevocable.
Whether a particular individual has standing to sue a trustee for a certain reason may vary by jurisdiction, but beneficiaries almost always have standing to sue. A large part of a trustee's responsibility is prudently investing the trust funds. Most state laws contain prudent investment standards for trustees.
The best chance you have to stop a trustee, to prevent that trustee from running away with the rest of the money, or losing the rest of the money is to get a court involved as soon as possible so that a court can put a freeze to those accounts, put a freeze to the trustee's actions, potentially remove the trustee out ...
The answer is a resounding yes. The ability to seek removal and replacement of a trustee is one of your most important rights as a trust beneficiary.
Yes, a trustee in California can withdraw money from a trust, but only under certain conditions. The authority to withdraw and use trust funds must be in accordance with the terms of the trust document and California law.
The answer to who holds more power depends largely on the context and specific circumstances of the estate or trust. Here's a summary to help clarify: Duration of Authority: Trustees often have ongoing responsibilities and powers that can extend indefinitely, while executors have a more limited, temporary role.
Co-trustees may have equal powers, or their powers may be divided in accordance with the trust instrument. Two trustees can be required to obtain the consent of the other trustees before taking certain actions, or you can authorize one co-trustee to act alone.
Those who are named trustees of certain real property may also commence a partition action. Even though a trustee is not an individual who is enumerated in the partition statutes, if the trustee is also a co-owner of the property, he or she may commence a suit.
In order for the beneficiary to hold the trustee accountable, the beneficiary must have information about what the trustee is required to do and what the trustee actually does. Thus, the trustee has a duty to account and to inform.
At the point when an attorney or court determines that a Trustee is unable or unwilling to continue serving, it will be necessary for the Successor Trustee to accept their new role as fiduciary.
Resolving Problems Among Co-Trustees
The trustees may agree to ask the court for instructions, or one trustee may appeal to the court to prevent the other trustee from acting. If disagreements happen frequently, one trustee may resign, or one may petition the probate court for removal of the other trustee.
A trustee must abide by the trust document and the California Probate Code. They are prohibited from using trust assets for personal gain and must act in the best interest of the beneficiaries. Trust assets are meant for the benefit of the trust beneficiaries and not for the personal use of the trustee.
In general, the steps to this process are: The trustee must send a written notice to the beneficiary to vacate the real property. Under California law, if the beneficiary has been in possession of the property for less than a year, then a 30-day notice is sufficient.
If the trustee is not paying beneficiaries accurately or on time, legal action can be taken against them.
Depending on the complexity of the case, it may cost anywhere from a few thousand dollars to $100,000 or more to dispute the terms of a trust.
A trustee typically has the most control in running their trust. They are granted authority by their grantor to oversee and distribute assets according to terms set out in their trust document, while beneficiaries merely reap its benefits without overseeing its operations themselves.
Under California law, embezzling trust funds or property valued at $950 or less is a misdemeanor offense and is punishable by up to 6 months in county jail. If a trustee embezzles more than $950 from the trust, they can be charged with felony embezzlement, which carries a sentence of up to 3 years in jail.
Negligence or Mismanagement of Trust Assets
So, if a trustee fails to do so, whether it is out of negligence, incompetence, or outright malice, then a trustee is unfit to manage the trust, and this constitutes a breach of his or her fiduciary duty and can be one reason for removing a trustee.
Typically, a revocable trust with clear provisions for outright distribution might conclude within 12 to 18 months. However, in simpler cases, the process can take an average of 4 to 5 months without complications.