Can A Trust Beneficiary Object To The Administration Of A Related Probate Estate?
Many Florida residents create both a revocable trust and a will as part of their estate plan. It is also common practice, though certainly not necessary, to name the same person or persons as trustee and personal representative. This enables the same individual (or individuals) to oversee the administration of all assets after the settlor/testator passes away.
Florida Appeals Court: Widow Had Standing to Challenge Estate Expenses
The decision to have the same people oversee the probate estate and trust can also have some interesting ramifications when it comes to who may file an objection in any subsequent legal proceedings. A recent decision from the Florida Third District Court of Appeal, Duff-Esformes v. Mukamal, provides an interesting example. In this case, there was a dispute over whether a beneficiary of a probate estate had legal standing to challenge actions taken by a related trust.
A man with the last name of Esformes died in 2015. Before his death, Esformes executed a will and a revocable living trust. He named the same two men to serve as both co-personal representatives and co-trustees. The will designated the trust as the sole beneficiary of the probate estate. The trust, in turn, was to pay all income on the trust’s assets to Esformes’ widow during her lifetime.
The personal representatives–who, again, were also the trustees–proceeded to probate the will and moved to make a final distribution of probate assets to the trust. As part of the final distribution, the trial court reserved $50,000 from the probate estate’s assets to “pay additional Estate administration expenses,” such as legal and professional fees. When the personal representatives filed a subsequent motion to actually pay these fees, however, the widow filed an objection. She argued the proposed expenses were not “reasonable” under Florida law.
The personal representatives argued the widow had no standing to challenge the distribution of the probate estate, as she had “already received her complete distribution from the probate estate.” At this point, she was only a beneficiary of the trust. The trial court agreed with the personal representatives and struck the widow’s objections.
On appeal, however, the Third District Court of Appeal held the widow did, in fact, have standing. The Probate Code allows any “interested person” to object to the payment of fees to a personal representative or their attorneys. An interested person is defined broadly as “any person who may reasonably be expected to be affected by the outcome of the particular proceeding involved.” As a lifetime income beneficiary of the trust the widow was an interested person, the Third District reasoned, as any money spent on the probate administration would reduce the income from the trust. Furthermore, even though the widow had already received her distribution from the probate estate, she was still considered a “beneficiary of the estate,” as Florida law makes a special exception for cases where the trustee “is also a personal representative of the estate.”
Speak with a Florida Trust Litigation Lawyer Today
Beneficiaries often disagree with the compensation arrangements for fiduciaries in these types of cases. If you are involved in such a dispute and need legal advice from a qualified Pompano Beach trust and estate litigation attorney, contact the offices of Mark R. Manceri, P.A., today to schedule a consultation.