It’s been twelve months since your mom died. You and your sister are your mom’s only children. She established a trust a few years ago.
She made herself the trustee during her lifetime, and her accountant, Mumford Pennypincher, the successor trustee. Your mom’s real estate, securities and bank accounts are assets that are in the trust.
The trust provides for the support of your mom during her lifetime. The trust does not become irrevocable until she passes away. Since the trust is revocable your mom can invade all, part or none of the principal and income for her benefit during her lifetime.
A few weeks after you mom passes away, you ask you own estate planning attorney, Maggie Einstein, to review the trust and explain it to you. Maggie calls it a support trust. She explains that it has terms that provide that the trustee has discretion to distribute either income or principal among you and your sister, but only for your health, education, maintenance and support.
Maggie also explains that the Association of Irish Wolfhounds (the “Wolfhounds”) is the remainder beneficiary of your mother’s trust. She says that though the Wolfhounds, the remainder beneficiary, may at your deaths be entitled to the entire remaining principal, until then, they are entitled to nothing.
Mumford Pennypincher, now acting as the trustee of the trust, is difficult to communicate with.
You feel that you’re getting the run around. What little information that you have received is Mumford’s expressed concern that he must administer the trust to preserve capital.
Your lawyer, Maggie, says that while this might be so in part, Mumford has a primary duty to deal with each of the beneficiaries impartially. And, this includes successive beneficiaries like you, your sister and the Wolfhounds.
Mumford seems baffled. He doesn’t know whether to invest for a maximum current return, a reliable income stream or toward a goal of increasing the real value of the principal over time.
Mumford seems frozen. His current stance is to provide you and your sister very little income.
He makes no inquiry as to your current needs for your health, education, maintenance and support. In addition, you learn from the President of the Wolfhounds that Mumford has not communicated with them at all.
The case is not going to the dogs. It’s going nowhere at all.
So, you are in a predicament. Do you let Mumford proceed along on an uninformed, secretive and unfair path or do you do something? If so, what can you do?
Your estate planning lawyer, Maggie, tells you that she knows that you do have some remedies.
That said, she says that she is not a litigator and that you should talk with lawyers experienced in estate and trust litigation. You call us.
I’ll just hit a few high points. You have the right to an accounting from Mumford Pennypincher. Mumford doesn’t have the unfettered right to keep you in the dark. Mumford has investment responsibilities that he may now be failing. Mumford does not have absolute discretion to deny you resources needed for your health, education, maintenance and support.
Mumford has what is called ascertainable discretion. Doing nothing is not within the bounds of ascertainable discretion. A likely action against Mumford in the probate court is generally located in the county in which the trust is administered.
Sitting on your rights is not the best plan. You can contact a lawyer experienced in trust and estate litigation. You can explore your options with regard to attorney’s fees and costs.
At our firm, Hackard Law, we take substantial cases where we think that we can make a significant difference and there is a wrongdoer who can be made accountable for their wrongdoing.
We are California based and litigate only in California’s Superior Courts – both civil and probate.
If you would like to speak with us about your case, call us at Hackard Law – 916 313-3030.