Trusts are legal instruments that tend to play a key role in estate plans. The people who are set to benefit from the trust are commonly referred to as beneficiaries, and trustees are expected to act in their best interests at all times.
Although trusts will typically include very specific instructions, there are some general principles to which trustees are expected to adhere. Some of these are outlined below;
A firm understanding of trust terms
Trustees must implement the trust terms specifically, and to do so, they should obtain a firm understanding of them. Trustees adopt a fiduciary relationship with beneficiaries, which means they must act honestly and in good faith in accordance with instructions outlined in the legal documents.
Openness with beneficiaries
Trustees are responsible for looking after accounts relating to the trust, and beneficiaries should not be kept in the dark about such matters. Beneficiaries have a right to access information about the trust and trustees should not go out of their way to withhold such information.
Trustees are frequently tasked with distributing assets according to the final wishes of a family member. Needless to say, such duties must be carried out in a careful manner and without recklessness. They’re also expected to manage the funds in the trust responsibly, and that means looking carefully at potential investments or expenses.
What if a trustee fails in their duties?
There are a number of potential remedies if a trustee fails to act appropriately. For instance, the court may intervene and direct trustees in how to appropriately administer the trust. In some cases, the court may require a trustee to step down so that a replacement can be sought.
The position of trustee is one of great responsibility and it must be carried out accordingly in the best interests of beneficiaries. If you feel that a fiduciary duty has been breached, there may be legal remedies open to you.