Probate Code Section 16460

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Can a California trustee require a beneficiary to sign a release in order to get a distribution from a trust?  A question like this appeared recently on the AVVO “Free Q&A” page and makes for a perfect blog topic.

Trustees understandably want to wrap up trust administration without having to worry about being sued by beneficiaries.  When a beneficiary appears to be litigious, the trustee may want to dangle a preliminary or final asset distribution as a carrot to get the beneficiary to sign a release.  Yet, since the trustee is a fiduciary, California law does not give a trustee unfettered discretion to insist on releases.  An effort to prevent trust litigation could end up sparking such litigation.…

This blog post views a trustee’s fee from the beneficiary’s perspective.  Under California law, a trustee generally can set his or her own fee and collect it without prior disclosure to the beneficiaries.  What can a beneficiary, who sees a hand reaching too greedily in the trust cookie jar, do in response?

We discussed best practices for a trustee when claiming a fee in a prior post and now consider how a beneficiary can monitor, evaluate and object to a trustee’s fee.…

Businessman running with butterfly net chasing money which is flying in the air. Finance business concept.

Trustees in California trust disputes should not overlook the power of the constructive trust remedy as a way to recover errant trust assets.  That’s a takeaway from Higgins v. Higgins (2017) 11 Cal.App.5th 648, an opinion in a trust litigation case published last week by the California Court of Appeal.

A Los Angeles Superior Court trial judge found a “clear moral obligation” on the part of Lupe Higgins to return several hundred thousand dollars to the Higgins Family Trust, but could not find a legal obligation, so the judge apologized to the Higgins family for being powerless to restore the funds.  The appellate court did not like the sound of that music and came to the rescue, ruling that the trial court had discretion to compel Lupe to transfer the money to the trustee of the Trust.…