When Trustees Go Rogue

Should we live in a perfect world, all estate matters would be to manage with care, transparency, and integrity. After all, trustees are legally bound by a fiduciary duty to act in the best interests of the trust’s beneficiaries. But when trustees act selfishly or fail to provide required information, beneficiaries have legal options.

Share your specific concerns with a Pompano Beach estate litigation lawyer to pave a path forward. In Florida, estate litigation plays a key role in holding trustees accountable and protecting the interests of those harmed by misconduct.

Warning Signs of Misconduct

Trustees in Florida are required to follow the terms of the Trust and comply with the Florida Trust Code. Their duties include acting in good faith, managing trust property prudently, providing accountings, and avoiding conflicts of interest. Unfortunately, some trustees violate these responsibilities, whether through negligence or intentional misconduct.

Common red flags include:

• Failure to provide accountings or financial statements when requested by beneficiaries.
• Unexplained losses or asset transfers, especially to the trustee or their associates.
• Delays in distributions that are not justified by trust terms.
• Self-dealing or conflicts of interest, such as a trustee investing in their own business using trust funds.
• Inadequate communication, refusal to answer beneficiary inquiries, or secretive behavior.

If beneficiaries begin to suspect any of these issues, it’s essential to act swiftly and seek legal guidance.

When concerns arise, beneficiaries should request an accounting and raise concerns in writing. Trustees are required to provide a report of income, expenses, and disbursements. If a trustee refuses or fails to do so, litigation may be necessary.

Legal remedies for beneficiaries may include court-ordered accounting or the removal of a trustee. Florida courts may remove a trustee for cause, including breach of trust, incapacity, or failure to administer the trust effectively. Surcharge actions, when beneficiaries can seek damages, may also be possible.

Cases Where Trustees Were Held Accountable

Florida Courts have a history of stepping in when trustees breach their duties. In one Florida case, a trustee failed to distribute assets and provide an accounting over several years. The Court found the trustee had mismanaged funds and removed him, appointing a professional fiduciary in his place.

In another situation, an appeals court upheld the removal of a trustee who made unauthorized distributions to herself and invested trust assets in speculative ventures. The court determined that her actions violated both the trust’s terms and her fiduciary obligations.

The reality is that because trustees hold significant power, they also have a lot of legal responsibility. If you’re a beneficiary concerned about mismanagement or misconduct, don’t wait for the damage to worsen. An experienced Pompano Beach estate litigation lawyer can investigate the situation, enforce your rights, and pursue appropriate legal remedies.

Are you ready to talk to an attorney about your worries? Trusts are meant to offer peace of mind. When trustees fail in their duties, the law provides a path to justice. Have a conversation with the estate attorneys at Mark R. Manceri, P.A. to learn more. Schedule a confidential consultation today.