While the preparation of a trust helps an estate avoid probate, it does not completely eliminate the need for formal trust administration. Probate and the administration of a trust have many similarities, but one of the key differences is that trust administration allows most of the administrative tasks to be conducted outside of a courtroom. Some trusts are intended to exist for only a short time as the estate is dismantled, while others require longer periods of management, depending on how the trust was drafted.
The basic duties of a trustee involve the collection, management, and investment of assets, as well as the accumulation and distribution of income and principal in accordance with the terms of the trust. A trustee has a fiduciary duty to follow the terms of the trust, use ordinary care and diligence when acting as trustee, invest the trust funds in a reasonably prudent manner, avoid commingling trust funds with their own personal funds, and avoid conflicts of interest between the trustee and the trust beneficiaries.
A trustee can be held personally accountable for failure to comply with these duties. What this means is that a trustee who avoids fulfilling the fiduciary responsibilities with responsibility, trust, and prudence can become the subject of a lawsuit which can force payment of the personal assets of the trustee. The advice and counsel of an attorney skilled in matters relating to the administration of trusts can be invaluable to a trustee who is unaware of how to manage complicated trusts.
We assist our trustee clients with any and all portions of the trust administration process from commencement to conclusion. A trustee generally begins with notifying beneficiaries of the trust, gathering trust assets, guiding the formation and administration of sub-trusts, and distributing trust assets. When the trustee has managed the trust to the logical conclusion we will assist the trustee in being released from liability at the end of the administration.
Taking on the duties and responsibilities of a trustee can be an overwhelming experience. We understand the unique challenges that come with the administration of trusts, and we want to help you make it through this process in an efficient and relaxed manner. Please contact David Kelly to set up an appointment to discuss your unique position and requirements.