Founding Attorney
Although a person might feel as if they “won” because they got named to serve as the trustee of a relative’s trust, they often feel differently when they realize the massive amount of work involved. Also, they seldom understand the potential liability they face in that position. Just because you were named the trustee does not mean you have to do all the work yourself.
Many hire a Texas estate planning attorney to handle much of the trustee’s work. Often, a trust contains language that specifically permits this arrangement and authorizes the payment of the professional by the trust, but if the trust is silent on that issue, you can probably engage help.
Understanding the Responsibilities of a Trustee
Serving as a trustee involves significant legal and financial responsibilities. Trustees manage assets, distribute funds to beneficiaries, and ensure the trust operates according to its terms. While acting as a trustee can be an honor, it also carries risks, including legal liability, if duties are not handled properly. At the Law Office of Carey Thompson, we help trustees navigate their obligations and avoid costly mistakes.
Common Pitfalls and How to Avoid Them
1. Failing to Take Action in a Timely Way
Trustees must act promptly when managing a trust. Delays in distributing assets, responding to beneficiary concerns, or fulfilling trust duties can lead to disputes and even legal claims. Beneficiaries may become frustrated if they feel the trustee is neglecting their role. To avoid this mistake, trustees should stay organized, keep detailed records, and consult a probate attorney if they are unsure about their next steps.
2. Failing to Consider the Emotional Landscape
The administration of a trust often occurs after the passing of a loved one, which can cause emotions to run high. Trustees who ignore the emotional impact of their decisions may create unnecessary conflict. Trustees should approach their role with empathy, recognizing that beneficiaries may be grieving or dealing with family tensions. Communicating with sensitivity and fairness can help maintain trust and cooperation among all parties.
3. Failing to Communicate with Beneficiaries
Transparency is key to effective trust administration. Many disputes arise because beneficiaries feel left in the dark about trust decisions. Trustees should provide regular updates, respond to inquiries promptly, and ensure that beneficiaries understand how the trust operates. Establishing a clear communication plan can help prevent misunderstandings and legal challenges.
4. Ignoring a Beneficiary’s Rights
Beneficiaries have legal rights under Texas law, including the right to receive information about the trust and to be treated fairly. A trustee who withholds information, favors certain beneficiaries over others, or fails to distribute assets according to the trust’s terms could face legal consequences. Trustees must act impartially and follow the trust’s instructions while considering all beneficiaries’ interests.
5. Borrowing From the Trust
One of the most serious mistakes a trustee can make is borrowing from the trust for personal use. Even if a trustee intends to repay the funds, such actions can lead to accusations of mismanagement or even legal action. Trustees must keep personal and trust assets separate and avoid any conflicts of interest. If a trustee needs guidance on financial matters, consulting a probate attorney is essential.
How Our Firm Can Help
At the Law Office of Carey Thompson, we assist trustees in fulfilling their legal duties while minimizing risks. Our firm provides:
- Legal guidance to help trustees understand and meet their obligations.
- Assistance with trust administration to ensure compliance with Texas law.
- Support in resolving disputes and preventing costly litigation.
If you are a trustee and need help navigating your responsibilities, our team is here to offer experienced legal support.
Talk To a Texas Trusts and Estates Attorney Today
Serving as a trustee requires careful decision-making and legal knowledge. Contact the Law Office of Carey Thompson today to schedule a consultation and ensure that you fulfill your trustee duties correctly and efficiently.