Trustees are sometimes sued by the beneficiaries of a trust even though the trustee has done nothing wrong. In some cases, beneficiaries do not understand the legal and fiduciary obligations of the trustee concerning how the trust is to be managed, or the degree of discretion provided to the trustee. Instead, beneficiaries may want to improperly exert control over trust management, or they wish to force the trustee to make a distribution to them in violation of the trust documents.
When trustees are wrongfully sued by a trust beneficiary, we are there to defend and protect their interests, and ultimately the interests of other trust beneficiaries. We are familiar with the actions that beneficiaries sometimes take in an attempt to gain control over trust assets.
Often these actions are motivated by the financial needs that have nothing to do with the trust. The loss of a job or a loss in the stock market may create financial distress. When these events occur, beneficiaries may look to the trust as a potential quick source of cash, even though the beneficiaries may understand that they are not entitled to a distribution from the trust. As a result, their only recourse may be to allege trust mismanagement against the trustee in the hope that the trustee will pay damages or make a trust distribution, or that they will succeed in having the trustee replaced with someone else of their choosing.
If you have been sued or threatened with a lawsuit by the beneficiaries of a trust for which you serve as a trustee, please call our firm as soon as possible. It is important to obtain experienced legal counsel immediately to protect your interests and the interests of other trust beneficiaries. Once we can understand your situation, we can advise you as to your options and discuss with you any actions that should (or should not) be taken in response to beneficiary claims.
For information about fiduciary liability, please see: