Dealing with a recalcitrant trustee

Trusts are often an attractive method for North Carolina estate owners to pass on wealth outside the probate system. However, it is important that people select the right trustees when setting up a trust. Otherwise, the consequences could be significant for the intended beneficiaries. Trustees have a responsibility to manage assets in the interests of the beneficiaries, but some may be neglectful, disconnected or even corrupt.

It’s important to choose the right trustees, but beneficiaries can also act to protect themselves if they find themselves dealing with an uncooperative trustee. Beneficiaries are entitled to copies of the trust documents, and they should review the terms in order to gain a greater understanding of exactly what their rights are. Many people think they know about the trusts in their benefit, but they often have not read the documents themselves. When beneficiaries and trustees have different understandings, it can lead to conflicts.

In many cases, a beneficiary can resolve these issues by seeking a one-on-one meeting with the trustee, especially when it is a family member or another close person. However, if this fails, the beneficiary may go to a trust administration attorney for help. A lawyer can review the trust and advise the beneficiary on potential next steps. For example, the attorney could write a letter or seek a meeting with the trustee on the beneficiary’s behalf.

It is usually in the interests of all parties to resolve trust administration conflicts outside of court. Because a trust is a private document, it usually stays out of the courtroom. However, an attorney can help beneficiaries move forward if litigation becomes necessary, such as when a trustee is stealing from a trust.