Shady Documentation? Key Signs for Trust Litigation
Typically, beneficiaries approach the administration of a trust with optimism and belief that the trustee will fairly and adequately perform required duties. Unfortunately, that doesn’t always happen. Questions may regarding what were the trustor’s wishes and desires (the person who created the trust), as opposed to the trustee’s supplanted wishes and desires. To that end, a trustee may manipulate documents or refuse to provide documents, which if uncovered, would serve to prove malfeasance.
Do you have suspicions that documents provided by the trustee are untrustworthy? Are some documents missing or possibly altered? If confirmed, such actions are likely due to a “breach of trust” violation.
In a previous article, “Breach of Fiduciary Duty,” we discussed key duties of a trustee, such as loyalty, no self-dealing, impartiality, disclosure, etc. A trustee “is required to act in the highest good faith towards his/her beneficiary and may not obtain any advantage by the slightest misrepresentation. Concealment, threat, or adverse pressure of any kind is unlawful as long as the fiduciary relationship exists,” and any violation of these duties constitutes a wrong against the beneficiaries.
Examples of Shady Documentation
Below is a short list of shady documentation “red flags” (click here for the complete article, including “real world examples”). Recognizing these signs might help you to determine whether to seek legal counsel to protect your interests. Typically, these examples involve a family member or friend trustee, as opposed to a private professional.
- Do you suspect destruction of trust documents?
- Are there questionable changes or amendments?
- Is there a lack of transparency by the trustee?
- Are there clear signs of unfair or unequitable trust distribution?
- Does the trustee want to change the trust, saying it doesn’t reflect the trustor’s verbal instructions?
- Do documents suddenly appear?
- Has the trustee hidden or changed certain accounting records?
- Are statements for investments missing?
- Are some documents original and others are photocopies?
- Do some documents look like they have been altered?
- Are pages missing?
- Is the trustee on their 2nd or 3rd attorney?
When is litigation necessary in trust disputes?
There seems to be no end to the types of schemes a trustee will implore to benefit themselves. While trusts are typically designed to prevent unnecessary disputes, it doesn’t stop some trustees from trying to achieve illegal gain. When suspicious circumstances surround an amendment of a trust, anyone who has standing (i.e., the trustee, beneficiaries or heirs) can contest the trust’s terms. When disputes cannot be resolved between the trustee and beneficiaries, informally or when contesting the terms of the trust is necessary, litigation is the next step.
If you have concerns about your trust or trustee, our attorneys have the expertise and experience to handle your trust matter skillfully and efficiently. Please contact Mortensen & Reinheimer, PC at (714) 384-6053 to make an appointment, or use our online contact form. Our website is http://www.ocestateplanning.net.
About the author:
Noah B. Herbold, Attorney, is a Certified Specialist in Estate Planning, Trust & Probate Law (The State Bar of California Board of Legal Specialization). His primary focus is assisting clients with litigated matters such as: Trust Contests, Breach of Trust, Fiduciary Appointment and/or Removal, Asset Ownership, Beneficiary Rights, Determination of Heirship, Elder Financial Abuse, Property Disputes, and Conservatorships. Contact Noah at noah@ocestateplanning.net.