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Protecting a trust’s assets from an incompetent trustee

On Behalf of | Mar 14, 2021 | Probate Litigation |

Trusts are very versatile legal tools for people with unique legal, financial or personal situations. They can help someone protect their property from taxation or from creditor claims. They can diminish an individual’s personal wealth so that they can qualify for government programs. They can help people control their legacies or even allow them to provide for their pets after they die.

A trust created by a loved one might be a way for you and other family members to benefit from the assets they acquired during their life. Unfortunately, a negligent or incompetent trustee could rapidly diminish the value of the trust that they manage, potentially endangering the inheritance of beneficiaries. What can you do when a trustee makes bad decisions when managing trust assets?

You may need to challenge the trustee in probate court

The person who created the trust chose someone whom they thought was capable of managing the trust and its assets. However, if they misjudged the situation or if the trustee simply doesn’t have the time or energy to manage the trust any more, other people may need to step in and ask the courts to appoint a new trustee.

Provided that you can show that the trustee has not upheld the best interests of the trust and its beneficiaries, the courts might remove them from their position and appoint someone else. Showing that they have habitually made bad investments, failed to maintain assets or otherwise failed in a way that reduced the trust value, the courts may agree that someone with more time and experience would better serve the trust and its beneficiaries.