(916) 775-8542 What Are the Trustee Responsibilities and Obligations?
Anyone serving as or considering becoming a trustee needs to know their responsibilities, as do the estate’s beneficiaries. Understanding these fiduciary duties prevents legal pitfalls and personal liability and protects the trust’s integrity.
So if you are unsure what the trustee’s responsibilities and obligations are, keep reading. The high-stakes estate and trust dispute attorneys at Hackard Law further explain this topic in a way that is easy for you to comprehend.
What Are the Trustee Core Duties?
One of a trustee’s primary responsibilities is to manage trust assets for the beneficiaries’ benefit by strictly adhering to the grantor’s instructions for asset management. They would take control of and safeguard financial accounts, real estate, business interests, and other property to grow the principal while minimizing risk. This individual would also distribute income and principal to beneficiaries as directed by the trust, pay expenses, and file necessary tax returns, while keeping detailed, accurate accounting records.
What Are a Trustee’s Obligations to Beneficiaries?
A trustee’s obligations also center on their fiduciary duty to beneficiaries, by putting their interests first. It is essential that a trustee does not self-deal or make any decisions based on personal gain. They must act with loyalty, impartiality, and prudence, without showing favoritism, while clearly and timely communicating with heirs about essential matters. These fundamental details often include the trust’s health, activities, and the beneficiary’s needs.
What Happens if a Trustee Does Not Meet Their Obligations?
If a trustee in California fails to uphold their obligations and breaches their fiduciary duty, beneficiaries have the legal right to sue for damages. They may also compel court action to remove and replace the trustee. Unfortunately, a trustee could be held personally liable for losses, potentially even facing criminal charges for serious misconduct such as fraud or embezzlement. Consequences of self-serving actions include being forced to provide accountings and personal financial penalties.
Still Have Questions About Your Responsibilities and Obligations as a Trustee? Call Our Firm Today
Now that you have a better understanding of what the trustee’s responsibilities and obligations are, reach out to Hackard Law for assistance. If you were newly appointed, it is essential that you are aware that trustees should hire professionals, like attorneys, accountants, and investment managers, for guidance right from the start.
We are the law firm trustees from across the state of California turn to for a reason. Our experienced team has served our community for decades, and with our contingency structure, if we fall short of your expectations in court, there is no obligation to pay our fee.