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Solutions for The Have's - The Ones Entitled to a Trust

In our latest post on Trust uses and abuses, we are back discussing The Have’s. These are people named in a Trust document receive a gift, but who can’t seem to get it. Many Have’s know they are entitled to a portion of the Trust because they are named in the document. They are either supposed to receive a specific gift or a share of the residue. But Have’s have a big problem: usually a bad Trustee. The Trustee may refuse to disclose financial information, refuse to sell assets to fund Trust distributions, and refuses any request for an accounting.

Many people focus on Trustee removal when they are dealing with a bad Trustee. Sure, it would be great to get the bad Trustee out and a better Trustee into office. But Trustee removal is not so easy.

Why is it hard to remove a bad a trustee?

  1. It takes a trial with admissible evidence.
  2. That evidence must be gathered using the Discovery process, such as taking depositions, issuing subpoenas, and all the other discovery devices available to people in a lawsuit.
  3. It takes time and money to gather this evidence, usually many months to a few years, and then it takes time to get on the court’s trial schedule—again at least a year from filing and sometimes much longer.
  4. Plus, many of the things your Trustee does that you think are outrageous (and indeed they are) may not be viewed that way by a judge come time of trial. Remember, judges see the worst of the worst, so your outrageous case, is just another “day at the office” for the judge. That means you may not succeed in removing the Trustee even after all this work and time.

What Alternatives do I have for Bad Trustees?

Trustee removal is not the only way forward, however. What if you could obtain your rightful Trust distribution? Once you have the money and other assets in your hands, then you don’t care about the Trustee at all. For example, if you are owed $500,000 in stock, moving that stock from the Trust to your personal brokerage account is a big advantage because now you control the stock. You can then decide what to do with it without any interference from the Trustee. The same is true for homes, cash, cars, you name it. Getting assets out of the hands of a bad Trustee should be your top priority. Once the Trustee is no longer in control of your assets, they can do no more harm.

Distributing Trust assets to you may be far more important than Trustee removal. Of course, there could still be issue to litigate after a Trust distribution. If the Trustee took money, mismanaged assets, made unfair distributions to others, that can all be addressed in your Trust lawsuit against the Trustee. But at least the Trustee no longer has your money and your assets in their hands.

Keep in mind, you can file in court to both remove the Trustee and seek a distribution of your share of the Trust. A knowledgeable Trust trial firm, like Albertson & Davidson, LLP, can analyze your situation and decide the best claims to make when you file in court. What you should know is that there is more than one way to obtain your rightful inheritance. Don’t get too focused on only one solution when there may be various routes to achieve your goal.

In fact, this post just scratches the surface of the actions you can take to protect your rights in a Trust estate. That’s why it’s important for you to consult with a good attorney or law firm before the Trustee does too much damage to your Trust.