What to do if an executor is living off of money that should have been placed in trust?
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What to do if an executor is living off of money that should have been placed in trust?
He sold land on which he only had life time use of; I was to own it. He used the money to pay estate bills and the remainder of the money was to be put into a trust for me and my brothers. The estate is still open, all the bills are paid, but my dad is living off the money. It is a very large amount. I want to know if there is anything that I can do before it is all gone.
Asked on January 2, 2011 under Estate Planning, Texas
Answers:
S.L,. Member, California Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
You and your brothers could sue your dad, the executor(trustee) for breach of fiduciary duty. Fiduciary duty means that your dad was to perform his duties in good faith as executor(trustee) for the beneficiaries of the trust (you and your brothers). Your dad would be liable for the loss to the trust. The remedy to seek in your lawsuit would be a constructive trust to recover the amount that has been lost by your dad's actions. A constructive trust means that the wrongdoer is merely holding the funds and is to return them to the rightful parties. A constructive trust would require your dad to return to the beneficiaries what he has taken from the trust. The monetary amounts should be returned to the beneficiaries. As for the land that was sold, your dad would be liable for the value of the land based on the proceeds he received from the sale.
The language in the trust probably includes provisions for removal of the trustee for a breach of trust and should probably have designated a successor trustee who could administer the provisions of the trust under these circumstances where a breach of trust and removal of the original trustee occurs.
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