Riverside Trust Attorney Explains Trustee Mismanagement of Estate

Being appointed the trustee of an estate after someone has died essentially means acting out the final wishes of that individual on his or her behalf. As someone set to benefit from the administration of a trust, it follows that you will have concerns about the conduct of the trustee and want to address any problems as soon as possible.

Trust mismanagement is a serious matter.
A trustee’s first and foremost duty in the California trust administration process is to act in the best interests of those affected by the trust. That means that property must be maintained, assets soundly invested and distributed, and the needs of beneficiaries taken into account.

If you feel a trust is intentionally or inadvertently managed in a way that has caused it to lose a significant amount of value, then proving this, recovering damages and, if necessary, having the trustee removed is crucial to the future welfare of yourself and the other beneficiaries.

Examples of trust mismanagement:

  • A conflict of interest caused the trustee to act in the best interests of someone other than the beneficiaries.
  • The trustee favored certain beneficiaries and ignored the best interests of others.
  • Decisions were made for the trustee’s personal gain without regard to trustee’s fiduciary duties.
  • Profits resulting from the trust were not reported to beneficiaries.
  • The trustee embezzled funds from trust for personal use.
  • The trustee isn’t taking necessary action with the trust, isn’t sending out reports to beneficiaries, or is missing deadlines or not showing up at court.
  • The trustee let real property fall into disrepair or sold it for far below market value.
  • The trustee refused to seek the counsel of a financial advisor and made unwise investment decisions that lost significant capital.

Remember that trust mismanagement differs dramatically from a difference of opinion in dealing with trust assets; it’s not appropriate to take action against a trustee who is acting in accordance with his or her fiduciary duties in a way that simply differs from how you would like it done.

If you suspect trustee mismanagement, it’s important that you document any instances similar to those above and bring them to the attention of an attorney qualified in estate law.

As a beneficiary, you may be entitled to recover damages. 
A trustee’s mismanagement of assets is a serious breach of contract. If theft or negligence is involved, he or she may even be subject to criminal charges.

Once you’ve proven your case, you’ll use a financial advisor to predict, within reason, how much the trust would have made if it hadn’t been mismanaged. This is how courts determine how much you will receive in damages. Depending on the final verdict, you may also receive compensation for other aspects of your case.

If you suspect the trustee administrating a loved one’s estate isn’t acting in the best interests of you or other beneficiaries, you may want to discuss your case with a Riverside trust attorney.  The Grossman Law Firm offers San Diego trust litigation, probate litigation, will contests, and probate services. To schedule a no-cost, 30-minute consultation with one of our lawyers, call toll-free now at 888-443-6590, or fill out our online contact form.

Also request your copy of Scott Grossman’s essential book The Ultimate Guide to California Trust and Probate Litigation: How Sons and Daughters Get Their Rightful Inheritance from Their Parents’ Wills and Trusts, which is available to you FREE.

Scott Grossman

Scott Grossman

Attorney

The Grossman Law Firm, APC · 525 B Street, Suite 1500, San Diego, CA 92101 · (951) 523-8307