What to Do If You Believe a Fiduciary is Mishandling Assets


It is quite common for beneficiaries, shareholders and other parties in interest to have questions or concerns about how a fiduciary is handling their affairs. Sometimes these concerns can bloom into full-fledged litigation with beneficiaries aggressively pursuing removal of and even compensation from an agent they believe has failed to represent their interests. Pursuing this type of legal action must be done with caution and tact, as protracted litigation can often consume much of the property the fiduciary was meant to manage, ultimately harming the fiduciaries as much if not more than any mismanagement would have.

If you are the beneficiary of a trust or the potential heir of a deceased family member and you suspect your interests are not being represented, you can take several types of action under California law, short of litigation:

  • Request an accounting — Beneficiaries often have the right to request reasonable accounting of the estate or trust from the fiduciary. This can allow you to review a fiduciary’s actions in detail to determine if there is cause for alarm.
  • Replace the fiduciary — In cases involving disputes between trustees and trust beneficiaries, the terms of the trust instrument sometimes establish a procedure for removing a trustee. While not always the case, it may be possible for beneficiaries to remove a trustee without resorting to costly litigation.
  • Remonstrate with the fiduciary — In many cases, it may be possible to resolve your differences with a trustee by simple communicating your concerns, with the help of an experienced trust attorney if necessary.

Posted in Estate Planning | Tagged estate administration, estate planning, fiduciary duties, fiduciary responsibility, financial assets

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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