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What Is a Fiduciary Duty? California Trust Litigation Guide

By May 12, 2026No Comments
What is a Fiduciary Duty?

Table of Contents

Key Takeaways

  • California trustees owe fiduciary duties to trust beneficiaries.
  • A trustee breaches a fiduciary duty by acting against the beneficiaries’ interests or violating the trust terms.
  • Common fiduciary breaches include self-dealing, withholding information, unreasonable distribution delays, and mismanaging trust assets.
  • Beneficiaries may petition the probate court to compel accountings, obtain trust information, suspend or remove a trustee, or seek a surcharge.
  • Taking legal action early may help preserve trust assets and limit further financial harm.

What Is a Fiduciary Duty?

A fiduciary duty is a legal obligation requiring one person to act in another’s best interests. In California trust administration, trustees owe fiduciary duties to the trust beneficiaries.
This duty is mandatory. Trustees must follow the trust terms, protect assets, avoid conflicts of interest, and keep beneficiaries reasonably informed during trust administration.
When trustees fail to meet those obligations, beneficiaries may begin to notice warning signs such as:
  • Missing financial information
  • Delayed distributions
  • Unexplained transactions
  • Refusal to provide accountings
  • Trust assets are being used for personal benefit
These issues are not only frustrating but may also signal a breach of fiduciary duty.
At The Grossman Law Firm, Attorney Scott Grossman represents beneficiaries and heirs throughout California in probate and trust litigation matters involving trustee misconduct and fiduciary breaches.

Common Examples of Fiduciary Duty Breaches by Trustees

While not every mistake constitutes a breach, certain actions frequently lead to trust litigation in California probate courts.

Self-Dealing and Personal Benefit

A trustee may not use trust property for personal gain unless explicitly authorized by the trust.
Examples may include:
  • Selling trust property to themselves below market value
  • Using trust funds for personal expenses
  • Borrowing money from the trust
  • Favoring one beneficiary over another

Failing to Provide Information

California trustees are generally required to keep beneficiaries reasonably informed about trust administration.
Problems often arise when trustees:
  • Refuse to provide a copy of the trust
  • Ignore requests for financial records
  • Fail to prepare accountings
  • Conceal trust transactions
A lack of transparency is often one of the first signs beneficiaries notice before litigation begins.

Delaying Distributions Without Explanation

Trust administration takes time, but beneficiaries should not be left in the dark indefinitely.
Sometimes, trustees delay distributions for years without meaningful updates or explanations. In other situations, trustees simply stop communicating altogether while trust assets remain under their control.
When delays become unreasonable, beneficiaries may need to seek court intervention to compel action.

What Beneficiaries Can Do If They Suspect a Breach?

If you suspect a trustee breached their fiduciary duties, documenting the problem early can make a significant difference.
Beneficiaries should consider:
  • Obtaining copies of the trust and amendments
  • Gathering financial records and communications
  • Requesting information about trust assets
  • Requesting formal trust accountings
  • Keeping records of delays or unanswered requests
This information can help evaluate whether the trustee violated California fiduciary duties and whether litigation may be necessary. At this point, it is best to consult an experienced trust and probate attorney.
In some cases, an attorney can petition the court to:
  • Compel an accounting
  • Suspend or remove the trustee
  • Freeze trust assets
  • Recover financial losses to the trust
  • Appoint a neutral successor trustee

What Is a Fiduciary Surcharge?

A surcharge is a financial remedy that the probate court may impose on a trustee who caused harm to the trust or its beneficiaries.
In general, a surcharge requires the fiduciary to personally repay losses resulting from misconduct or improper management.

When Courts May Order a Surcharge

A surcharge may arise from:
  • Improper expenditures
  • Missing trust funds
  • Unauthorized transactions
  • Financial losses caused by mismanagement
  • Disallowed trustee compensation or expenses
In some cases, beneficiaries may also seek interest, appreciation damages, or lost investment value that the trust would have earned absent the trustee’s conduct.
Importantly, trustees may have to pay those amounts from their own personal funds.

When a Fiduciary Breach Becomes Trust Litigation

Many beneficiaries initially hope problems can be resolved informally. Sometimes they are. Other times, trustees continue withholding information, delaying distributions, or mishandling assets despite repeated requests.
This is often when trust litigation begins.

A Real-World Example of Trustee Misconduct

The names, facts, and circumstances in this example have been modified for privacy.
In 2022, our client, Melissa, became concerned when her brother, who was serving as trustee of their mother’s trust, stopped responding to requests for information.
Their mother passed away in late 2021. The trust owned a home in Orange County along with several investment accounts. Melissa repeatedly requested a copy of the trust accounting but received only vague explanations about “ongoing administration.”
Months later, Melissa discovered trust funds had been used to pay several of the trustee’s personal expenses.
After contacting The Grossman Law Firm, litigation was initiated to compel a formal accounting and investigate the missing funds. The court later ordered financial disclosures and additional oversight regarding the administration.
Beneficiaries often do not know the full extent of the problem until litigation forces transparency.

FAQ

What is a fiduciary duty in California?

A fiduciary duty is a legal obligation requiring a trustee or other fiduciary to act in the best interests of the beneficiaries and the trust.

Can a trustee be sued for breach of fiduciary duty?

Yes. Beneficiaries may have grounds to bring legal action if a trustee violates their duties under California law or causes harm to the trust.

Common examples of trustee misconduct?

Common examples include self-dealing, withholding information, unreasonable delays, failing to provide accountings, and mismanaging trust assets.

What is a surcharge in trust litigation?

A surcharge is a financial judgment requiring the trustee to repay losses caused by their misconduct or breach of fiduciary duty.

How The Grossman Law Firm Can Help

The Grossman Law Firm helps beneficiaries and heirs throughout California enforce their rights in probate and trust litigation.
Call (888) 443-6590 or fill out our Get Help Now form to learn more.
Our Intake Specialists can evaluate your case at no cost. Qualifying cases will be scheduled for a free phone consultation with Attorney Scott Grossman.
Originally Published: Apr 3, 2023