Trustees and beneficiaries have distinct roles during administration. When the two clash, timely legal guidance can prevent disputes from escalating.
When a trust creator (called a settlor, grantor, or trustor) dies, the successor trustee initiates trust administration to distribute trust assets to beneficiaries according to the provisions of the trust.
Unlike estates governed by a will, trusts generally avoid the probate process. This means that, unless trust litigation arises, the administration process can proceed privately and without direct court oversight.
In an ideal scenario, the trustee and beneficiaries share a common goal: to carry out the decedent’s wishes as outlined in the trust. Unfortunately, in reality, that isn’t always the case. Sometimes, either the trustee or one or more beneficiaries act in their own self-interest — contrary to the trust’s terms or the collective best interests of the beneficiaries. To prevent this, a system of checks and balances exists between trustees and beneficiaries.
The trustee, who is responsible for overseeing and directing the trust’s activities, must keep beneficiaries informed, maintain thorough records, and adhere strictly to the trust’s terms.
Beneficiaries, in turn, are entitled to a clear view of the trust’s activities and have several legal tools at their disposal to ensure transparency and accountability. They can petition the court to compel an accounting, demand information, enforce the terms of the trust, or even seek to remove and surcharge a trustee who fails to uphold their fiduciary duties.
When trustees understand their powers and limitations, and beneficiaries understand their rights and remedies, the relationship between them can remain cooperative. This often results in a more efficient, cost-effective administration — and ultimately, more of the inheritance reaching the beneficiaries rather than being spent on litigation or administrative costs.
For example, suppose a trust directs that distributions be made within three months of the settlor’s passing. The trustee, however, temporarily withholds distributions to obtain clarification from the court about an ambiguous term in the trust.
This can be a valid reason for delay, so long as the trustee communicates clearly with beneficiaries about what’s happening and why. Open communication helps maintain trust and prevents unnecessary conflict.
Beneficiaries should also know that they have the right to ask about the status of their distributions, and the trustee is legally required to respond. If a trustee unreasonably withholds distributions, beneficiaries can petition the court to compel payment.
While most trustees retain a probate attorney to guide them through trust administration, that attorney represents only the trustee, not the beneficiaries. For this reason, it’s often wise for beneficiaries to retain their own probate attorney during the process, particularly if they distrust the trustee. Doing so ensures their rights are protected and that they receive the inheritances to which they’re entitled, when they’re entitled to receive them.
