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By: Scott Grossman on May 15th, 2024

Who is entitled to a copy of a trust in California?

Understanding Trustee Obligations to Beneficiaries

When it comes to trusts, it’s essential to know who is entitled to a copy of the trust document. This article will help you understand the trustee’s duties to beneficiaries and heirs. And who is entitled to receive a copy of a trust document in California? 

Who is entitled to a copy of a trust? 

Understanding who is entitled to a copy of a trust in California is essential for both trustees and beneficiaries. California beneficiaries and heirs are lawfully entitled to a copy of the trust, which guarantees clarity of the trust terms. 

Trustees are responsible for managing the trust assets, keeping beneficiaries informed, maintaining accurate records, filing tax returns, distributing trust assets, and acting impartially. 

Furthermore, trustees must fulfill their fiduciary duties, including maintaining loyalty to the beneficiaries, exercising reasonable skill and care, following trust instructions, and preserving trust assets. By adhering to these obligations, trustees can effectively carry out their duties and ensure the trust operates in the best interests of the beneficiaries. But what happens when they breach their trustee or fiduciary responsibilities as a trustee? 

Trustee Duties and Responsibilities Explained

A trustee is an individual or entity appointed to manage and administer a trust. Whether it’s a revocable or irrevocable trust, the trustee’s role is crucial in ensuring the smooth operation of the trust. But what exactly are the trustee’s duties and responsibilities in California?

The primary duty of a trustee is to act in the best interests of the beneficiaries. That means that the trustee must manage the trust prudently, follow the instructions in the trust document, and make decisions that benefit the beneficiaries.

Additionally, trustees have a fiduciary duty to act with the utmost loyalty and honesty towards the beneficiaries. This duty requires the trustee to avoid conflicts of interest and act in good faith, always putting the beneficiaries’ interests first.

Trustee Responsibilities: Understanding fiduciary duty 

California has specific laws and regulations that govern the responsibilities of trustees. These responsibilities include:

  • Managing the Trust Assets: Trustees are responsible for managing the assets within the trust, including investments, property, and any other assets designated in the trust document.
  • Keeping Beneficiaries Informed: Trustees are required to keep the beneficiaries reasonably informed about the trust’s administration. That includes regularly updating the trust’s financial status and any significant decisions or changes.
  • Accounting and Record-Keeping: Trustees must maintain accurate records of all trust transactions, including income, expenses, distributions, and other relevant financial information. These records are essential for ensuring transparency and accountability in the trust administration.
  • Filing Tax Returns: Trustees are responsible for filing any necessary tax returns on behalf of the trust. That includes income tax returns, gift tax returns, and, if applicable, estate tax returns.
  • Distributing Trust Assets: Depending on the terms of the trust, trustees may be responsible for distributing trust assets to the beneficiaries. Trustees must ensure that distributions follow the trust document and any applicable laws.
  • Acting Impartially: When making decisions that affect multiple beneficiaries, trustees must act impartially. That means considering the best interests of all beneficiaries and avoiding favoritism or discrimination.

Understanding Trustee Duties

In addition to the responsibilities mentioned above, trustees in California must fulfill certain duties. These duties include:

  • Duty of Loyalty: Trustees must always act in the beneficiaries’ best interests and avoid self-dealing or conflicts of interest.
  • Duty to Exercise Reasonable Skill and Care: Trustees must exercise the level of care, skill, and prudence that a reasonably prudent person would use in similar circumstances.
  • Duty to Follow the Instructions of the Trust Document: Trustees are legally bound to follow the instructions outlined in the trust document to the best of their abilities.
  • Duty to Preserve and Protect Trust Assets: Trustees must take reasonable steps to protect and preserve the assets held within the trust. That involves maintaining insurance coverage, overseeing investments, and preventing waste or loss.

These duties and responsibilities ensure that trustees act in the best interests of the beneficiaries and fulfill their obligations as outlined in the trust document and California law.

Consequences of Breaching a Fiduciary Duty

Further, when trustees breach their duties, they may face various consequences. This includes:

  1. Personal Liability: The trustee may be liable for any losses the trust beneficiaries suffer due to the breach. 
  2. Removal from Position: Beneficiaries may be able to have the trustee removed from their position and replaced with another trustee. 
  3. Monetary and Non-Monetary Damages: A breach of trust can lead to financial or non-monetary damages for the beneficiaries. 
  4. Legal Action: The trustee could face legal action, court expenses, and attorney fees. 

Some common examples of trustee breaches of duty include self-dealing, negligence, imprudent investments, and failure to distribute trust income. To avoid these consequences, trustees need to fulfill their responsibilities and act in the best interests of the beneficiaries. 

Beneficiary Rights

If you would still like more information on what exactly qualifies as a breach of fiduciary duty, check out our article “20 Ways Your Trustee can be breaching their fiduciary duties” on our website. If you have more questions about your beneficiary rights and what you should know moving forward. 

More on your Trustee Breaching their Fiduciary Duty

Need more information on Trust Litigation? To ensure they follow their fiduciary duties, check out our complete Overview of California Trust Litigation on our website. If you have more questions about your rights as a Beneficiary and what you should know moving forward. 

If you are still having some trouble, have any more questions, or want to talk to someone about your case, please give us a call or fill out our Get Help Now form below.

It’s best to reach out as soon as possible. The longer you take, the more damage your trust could take. Please call us at (888) 443-6590, and we would be more than happy to see if we can assist you.