Over the last several decades, trusts have grown in popularity to the point where it is now common to find a trust included in the average estate plan. Although trusts have also evolved to the point where there are now numerous specialized trusts aimed at accomplishing very specific estate planning goals, all trusts have a few basic elements in common, including the need for a Trustee to handle the administration of the trust. Because the Settlor appoints the Trustee, almost anyone can be a Trustee. If you recently learned that you are the Trustee of a trust, and this is the first time you have served as a Trustee, you may find that you are a bit intimidated by your duties and responsibilities as a Trustee. The Londonderry trust administration attorneys at DeBruyckere Law Offices offer five reasons to hire an attorney if you are the Trustee.
- Understanding the trust terms. A trust often contains complex terms that a Trustee must understand and abide by. Those terms are usually written by an attorney and include legal terms and concepts that may be difficult to understand without the assistance of a trust administration attorney.
- Explaining the law. Trusts are governed by state law; however, there are some federal laws that are also applicable. As the Trustee of a trust, you will be expected to understand all applicable laws and administer the trust according to those laws. Violating one of those laws could easily leave both you and the trust potentially liable for any damages.
- Conflicts with beneficiaries. If you are the spouse, child, or relative of the Settlor of the trust, chances are good that you also know the trust beneficiary. This often creates a conflict at some point during the administration of the trust. For example, imagine that you have discretionary powers under the trust terms that allow you to approve additional disbursements to a beneficiary over and above those that are scheduled by the trust terms. If you do not agree with the reason for the requested disbursement, you may find yourself in the middle of a conflict of interest. Your trust administration attorney can explain where your priorities need to be.
- Trust litigation. A trust is a separate legal entity that can become embroiled in litigation for several reasons. Just as a Will can be contested, so can a trust. Your job is to defend the trust during the ensuing litigation if that happens. One of the beneficiaries could also attempt to revoke or terminate the trust at some point, once again calling on you to defend the trust. Trying to defend the trust in court without the assistance of an experienced attorney is clearly not a wise idea.
- Modifying or terminating the trust. As the Trustee, you may become concerned about a provision in the trust that you believe need to be clarified or even modified. You might also reach a point at which you believe it is best to terminate the trust. Modifying or terminating a trust generally requires the approval of a court unless the Settlor retains that right. If you are required to seek court approval, you need an experienced trust administration attorney on your side to help you navigate the legal process.
As you can see, there are several reasons why you may need the services of an experienced trust administration attorney if you are appointed to be the Trustee of a trust. Knowing this, most Trustee’s retain an attorney early on to ensure that they have someone to consult with when issues come up during the administration of the trust. Doing so is the best way to ensure that you don’t make costly mistakes during your tenure as Trustee.
Contact a Londonderry Trust Administration Attorney
For more information, please download out FREE estate planning worksheet. If you have additional questions or concerns about the need to hire a trust administration attorney to help you fulfill your role as Trustee, contact the experienced Londonderry trust administration attorneys at DeBruyckere Law Offices by calling (603) 894-4141 or (978) 969-0331 to schedule an appointment.
Yes. A Trustee is entitled to a reasonable fee for his/her services. You may be required to provide documentation of the time/resources spent administering the trust.
Yes. You could face personal liability if you make a mistake while administering the trust which is another reason to consult with an attorney.
Yes. You always have the option to decline to accept the job of Trustee.