Fair and Equitable Trust Distributions

Ensuring Our Clients Receive Their Fair Share of Trust Property

When someone forms a trust (the "settlor"), they must draft a trust instrument, which is a document setting out instructions for how the successor trustee should manage and distribute the trust property. In some cases, these instructions are straightforward and clearly identify all beneficiaries, their interest in the trust, and how and when they will receive that interest.

In other situations, a trust document may not be as clear, or beneficiaries may be shocked to learn what the instructions contain. The instrument may exclude expected beneficiaries and include unexpected ones. Certain beneficiaries may be set to receive a significantly larger distribution than others. Such news can be shocking to beneficiaries who always expected the settlor would treat them equally.

If you suspect that a trust instrument does not accurately reflect what the settlor would have wanted, you should discuss your concerns with a Los Angeles trust litigation law firm as soon as possible. Hackard Law regularly represents beneficiaries or disinherited individuals who believe wrongdoing occurred to influence the settlor in the drafting or amending of the trust instrument. Please call today to schedule a consultation.

Addressing Your Concerns

We often have clients say the same things after learning of surprising trust instructions:

  • "I know my parents would never do that."
  • "Mom and dad always said all three children would be treated equally after they pass away."
  • "I know my Mom was not close to that person [set as a beneficiary]."

All of these can be red flags that some wrongdoing possibly influenced a settlor when dictating distributions. While the trust instrument may say one thing, we know there may be other powers at play. Our trust litigation attorneys can delve deeper into the possible motivations behind the trust document, and we can examine to see whether a settlor was a victim of undue influence or whether they may have lacked the capacity to draft a trust instrument.

Undue Influence

Sometimes, a relative or caretaker will take advantage of close contact they have with an aging individual to try to obtain a larger portion of money or property than they should have. The influencer may use many tactics, including:

  • Convincing the elder they are the only person who is willing to help them
  • Planting seeds of distrust of other beneficiaries or heirs
  • Basing care on financial rewards
  • Alienating the elder from other relatives
  • Threatening abuse unless the elder rewards them with an inheritance

Undue influence by an individual can unfold in many ways and may result in unfair trust distributions. For example, one child may exercise undue influence over a parent, resulting in the disinheritance of all other children but that one child. A more distant relative may end up with a substantial inheritance, thereby reducing the inheritances of children. A non-relative caretaker may receive the entirety of the trust, and the settlor may disinherit all children. These are only some examples of how undue influence can result in inequitable trust distributions.

Lack of Capacity

In order to form or amend a trust, a settlor must have the requisite mental capacity under California law. This means the settlor understands the nature of their property, the identities of appropriate beneficiaries, and the effects of executing a trust instrument. When someone does not fully understand the nature of their actions, it can result in unfair and inequitable trust distributions.

Proving someone lacked mental capacity can be challenging, as the law requires that you prove both of the following:

  • The settlor had a deficit in one or more mental functions, such as recognizing familiar persons, remaining oriented and conscious, understanding quantities, logical reasoning, or organized thinking, among others.
  • There existed a correlation between any deficits and the decisions related to trust distributions.

While this is not an easy task, our trust litigation attorneys regularly examine whether settlors lacked capacity and whether the trust instrument is thus invalid.

Seeking Fairness and Equity for Our Clients

At Hackard Law, we know that most beneficiaries do not seek their fair share of an inheritance out of greed. Instead, they had certain expectations of fairness and do not believe the settlor would have instructed otherwise. Our lawyers know that inequitable trust documents should not be valid if they involved undue influence or lack of capacity, and we regularly call such trust instruments into question to protect the rights of our clients.

Simply stating that your trust distribution was not what you expected is not enough to invalidate a trust instrument. Instead, you must provide sufficient evidence of wrongdoing or lack of capacity for a court to invalidate a trust and order fair distributions. Our attorneys closely scrutinize the document itself, as well as any unusual circumstances, to gather such evidence.

In some cases, the last-minute inclusion - or favoring - of a surprise beneficiary will raise suspicions of undue influence. We can then investigate the relationship between the settlor and the influencer to gather evidence that they traditionally should not have been included or favored in the trust document. We also use medical experts and other resources to prove that a settlor lacked the capacity to amend a trust in accordance with California probate and estate laws. We can advise you whether you have a valid case to challenge a trust distribution and can guide you through this process.

Contact Our Los Angeles and Santa Clara Estate Litigation Lawyers Today

The trust litigation attorneys at Hackard Law know how shocking it can be to learn that a parent or close relative disinherited you or disproportionately reduced your inheritance. We know how to investigate the circumstances behind the trust document, including any late amendments or the settlor’s mental capacity. Invalidating provisions of a trust instrument can be difficult, however, our attorneys thrive in this sort of case. Our skill and experience in trust litigation allow us to stand up for the interests of our clients in mediation or in court.

If you would like to discuss any concerns with a trust or other aspects of an estate plan, please contact us online or by calling (916) 313-3030 from Santa Clara or (213) 357-5200 from Los Angeles.