Course 10 — Lesson 2: The Law for Trustee Treating Beneficiaries Unfairly

[Music] Now let's listen to the approach that Stuart Albertson would take to fight for your inheritance hi this is Stuart Albertson and we've got an issue here where Lupe wants some real property Miguel wants some real property they can't agree on that with Miguel being the trustee he's the one that owes all the duty to the other three trust beneficiaries and then you've got Carlos and Damian who are just happy to be cashed out they don't want to be part of this intra-family fight they want their money they want to move on so we represent Lupe in this scenario what are the options that will best meet Lou BAE's needs let's look at our options again option one is to file a petition for instructions and in that petition for instructions ask the court to order Miguel to distribute the house the home or $250,000 to Lupe this is a good option for Lupe Lupe can file this she has nothing to lose as a trust beneficiary she can come forward and say I'd like to get this house we have an appraisal we've attached an appraisal to the petition for instructions we'll even give a little bit above fair market value we would like this house as part of my distribution an in-kind distribution and the only reason McGill's not making this distribution is because he wants the trust asset for himself the problem for Miguel is he's the trustee and if you'll remember at a Probate Code section 16003 where there are two or more beneficiaries of a trust the trustee must treat everybody and partially so Miguel really can't fight for himself here as a trust beneficiary because he has to treat everybody equally so there's a chance that Lou pays petition for instructions may be successful with the probate court and getting the probate court to order in kind distribution of her share of the trust to her through the family home what about a petition for an accounting that was our second option where Miguel is gonna have to file a petition for accounting this is Lupe making Miguel work ok Miguel she's saying you don't want to distribute the trust asset to me you don't want to make an in-kind distribution to me want to know what you've done ask a trustee to see exactly what it is that I can look at from your management to see if there's anything I can point out to build some leverage so that I can make a deal with you ultimately to get the house the problem with this option is it takes time to get the accounting it also is gonna cost money trust money from McGill to create the accounting and then Lupe is gonna have to oppose the accounting if she has any problems with it and the other two beneficiaries that just want to be cashed out now they're getting agitated in the meantime what about trustee removal again this takes time you've got Carlos and Damian that simply just want their money they don't want to be part of a protracted fight and so asking to remove Miguel while he has breached his duties as trustee the minute he started favoring his own interests over those of Lupe because she's a beneficiary the petition for removal it's something you would want to consider if you were gonna go all the way in this case and in that Matt if that was to happen you would want to ask for the accounting as well so let's talk about the petition for damages and that would be damages against Miguel well the question is what damages so you again this is gonna take some time you're gonna want to file a petition to remove Miguel you're gonna want to file a petition for an accounting and then you're gonna do extend a discovery to determine what damages Miguel caused to the trust if any so we don't even know at this point if Miguel's caused damages other than the fact that he wants the family home which does breach his duty to treat all the trust beneficiaries and partially what about a petition to sell the real property this may be the second best option remember the first best option so far has been for Lupe to file a petition for instructions but the probate court asking it to direct Miguel to make the distribution of the family home to her in an in con distribution here the petition to sell the real estate is another petition for instructions with the probate court and here Lupe saying well listen if you're not going to distribute the family home to me I offered to take the rental property but you don't want to give me the rental property because of the long term leases that are associated with that property so I'm just gonna ask the court to order you to sell everything and then make all the distributions to the trust beneficiaries more than likely Carlos and Damian they're gonna like this option best because they simply just want a distribution Lupe likes this as a second best option because it forces me gills hand and selling the assets he ultimately wants to keep the family home too so maybe it brings him to the negotiation table and we can figure out how the rental property can go to Lupe the home can go to Miguel or maybe they switch that up and the rental property goes to Miguel and the home to Lupe but it gives options from a negotiation standpoint so ultimately in closing number one petition for instructions that's going to be quick it probably won't bother Carlos and Damian too much to wait for six to eight weeks for a court to hopefully instruct the trustee to act if the trustee still refuses to act ask the court to order the trustee to sell all the assets and make a distribution that's likely the second best option doesn't the accounting the petition for a County petition for removal and Proficient petition for damages while those may be good options if we're gonna go all the way into litigation protracted litigation if you don't want to cause a fight that's gonna cost a lot of money in time I would suggest not doing those unless you absolutely have to [Music] [Applause] you.