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Duties of a Trustee

Whenever property of any kind is to be transferred from one party to another, but not immediately, it is necessary that it be held temporarily by a designated individual known as a "trustee." While trust property is commonly real estate, it can also consist of cash, stocks and bonds, automobiles, expensive jewelry, or any other type of property. When trusts are created, both trustees and their successors, in the event of the original trustee's death, will be named. If an estate holder passes away without a will that names a trustee, the next of kin can petition to fill the position.

The specific duties and the restrictions placed on a trustee are outlined in the written trust agreement itself, but California law places certain basic duties on the shoulders of all trustees. They are obligated, in general, to see that the will of the deceased is followed when his or her property is distributed to the beneficiaries. Trustees are also under both a legal and moral duty to handle the trust property in a financially responsible manner and for the sole purpose of "benefiting the beneficiaries." If trustees violate these basic requirements, their actions in managing the property can be declared null and void, and they could even be sued for mismanagement. And beneficiaries can request a written account of the trustee's actions.

The trustee's typical duties will include such things as the following:

  • Make himself fully familiar with the details of the trust agreement
  • Ensure the trust's terms are 100 percent carried out
  • Charge no fees for trust-related services except where expressly permitted
  • Keep complete financial records on the property's management
  • Ensure that all relevant assets are appraised
  • Ensure that the property taxes and all creditors are paid
  • Avoid any commingling of personal funds with the trust's funds
  • Never delegate any of his duties to a third party

If, however, the beneficiaries agree to allow trustees to take actions in violation of the trust and indemnify them to do so, it is possible that certain obligations could be waived.

Many times, trustees will rely on professional estate planning organizations to guide them through the process without violating any of their duties. In Irvine, CA, and throughout Orange County, for example, Mortensen and Reinheimer provides full services related to trusts and their legal, proper administration. To learn more about trustee's duties and related matters, or to schedule a case evaluation, contact Mortensen and Reinheimer today at 714-384-6053 or fill out their online contact form.