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staycneedzhelp

Sister is trustee that has not honored trust.

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Hi,

My sister is the trustee of my grandmothers trust, along with a lawyer she hired.  All the beneficiaries with the exception of my sister and possibly her 2 sons have only gotten half of intended distributions.  The amount not paid out is to the tune of 200,000+.  Also, my 3 sons, myself and my sister's 2 sons were named the residual beneficiaries, and my sister does not acknowledge that at all.  I have spoken with my grandmother's accountant who was supposed to be used upon my grandmother's death, but my sister did not use him; she hired the attorney instead.  Anyhow, I have talked to the accountant and since he was already paid for services that were not used, I will be able to use those service myself.  He was appalled to learn that my grandmothers wishes were not adhered to, as my grandmother had very clear wishes in which she had in place for 20+ years. The accountant is ready as soon as I need him in court.  I cannot afford a lawyer and I would like to find a lawyer to work on contingency or I have to file on my own.  I live in California and the trust originated in AZ.  Can I file a breach of fiduciary here, or do I have to go to Arizona?  If I have to go to Arizona, do I have to go to the county originated or can I go to the 1st Arizona town and file there?  Thanks for your time and expertise in this matter.

Stacy

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Also, my 3 sons, myself and my sister's 2 sons were named the residual beneficiaries, and my sister does not acknowledge that at all.

 

If the trust instrument is clear about this, why does it matter whether or not she ackowledges your status?

 

 

 

I have spoken with my grandmother's accountant who was supposed to be used upon my grandmother's death, but my sister did not use him

 

Used for what purpose?  What do you mean that she "was supposed to" use the accountant?

 

 

 

she hired the attorney instead.

 

Well...lawyers and accountants are not generally interchangeable, so it's not really clear why you've made a point of mentioning this.

 

 

 

The accountant is ready as soon as I need him in court.

 

Ready to do what?

 

 

 

I live in California and the trust originated in AZ.  Can I file a breach of fiduciary here, or do I have to go to Arizona?

 

Probably Arizona, but it's not clear what you meant when you wrote, "the trust originated in AZ."  I assume it means that your mother lived in AZ at the time the trust instrument was executed.  Is that correct?  If so, that's not a terribly relevant fact.  More relevant is where your grandmother lived when she died (which I assume is when your sister became trustee) and where the trustee lives.

 

 

 

If I have to go to Arizona, do I have to go to the county originated or can I go to the 1st Arizona town and file there?

 

I don't know what you mean by "the 1st Arizona town."  The most likely place to file would be the county where the trustee lives.

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Hi staycneedzhelp,

 

If your sister, the trustee, lives in Arizona, it seems that you'll most likely have to file in Arizona. By "1st Arizona town," do you mean:  can you just drive to the closest court in the state of Arizona and file your case to get it "in" to Arizona? Unfortunately, the answer is probably "no." You'll have to file in a county that has some type of authority, relation, and/or connection to the trust instrument. You should probably consult with a local trusts lawyer to figure out the appropriate state and court for your case. Good luck to you!

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Sorry, I was not clear.  My sister lives in Mississippi and I live in California, right on the border of Az. I asked if I could file in the 1st Az town because there is a small Az town  5 miles from where I live, but the county in which the trust is connected to is about 5 hours away. 

As far as the accountant, he is important because he knows exactly how much money and assets my grandmother had ( estimated over a 2 million dollar estate, and that is being conservative)  My grandmother was not the type to leave loose ends; she intended for the beneficiaries to get exactly what she left and had monies appropriated in the right accounts to do that.  But, my sister complicated things by filing a petition against our now deceased mother.  My sister had gotten upset that our mother was given more in the last amended trust document, so she took our mother to court.  In doing so, accounts were misappropriated because their was confusion about 2 accounts: one being a Bank One bank account, which was my mothers transfer of death account and the other a Bank One Securities account, which had beneficiary distribution funds.  The court was only told about the Bank One Securities account, thereby believing this was the transfer of death account.  Based on that belief, they split that money between my sister and mother.  My mother was a cold women and she only cared about herself and went along with this as it benefited her immensely.  My sister benefited as well, and did not show any concern for the interest of the beneficiaries of this trust at all.  She petitioned the court soley for her and she feels no remorse for destroying the integrity of this trust.  I have requested an accounting and received bits and pieces (copies of checks with gaps between check #'s) and told matter-of-factly that myself and my sons will only get 20,000 each when we were supposed to get 40,000 each as well as receive money annually as residual beneficiaries.

Again, the accountant can prove my allegations, and in these kind of preceedings I understand that the accounting services to go through the trust finance can be costly.

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Do you know whether this is a revocable trust or an irrevocable trust?

 

Please calm down and do not assume that the trustee has committed a breach of fiduciary duty just yet.  You are not fully informed about trust matters and you need to do a bit of research first before you make assumptions.  Do a search engine search to get the definition of "residual beneficiaries" so you can get a better understanding of what a residual beneficiary is--residual beneficiaries get the residue from the trust--what is left over, if anything, after specific gifts have been distributed.  You may get nothing at all, or a windfall, depending on how the trust is written and what is in it.  So your sister may be following the instructions of the trust so far.

 

Please do not automatically assume that you can not afford the services of a trust attorney.  If you have a job, you can afford to pay one for his/her professional services and the advice in this case could be very valuable to you, or at least you need to determine your options about whether you should proceed further with this or not.  You are entitled to a complete trustees report/accounting annually (not just portions of it), perhaps in addition to a copy of the trust. Your first step is to ask your attorney if Arizona law requires the request for a copy of the trust to be made IN WRITING (not just verbally) by you or your attorney. Trustee will not be able to get away with stonewalling you (providing just bits and pieces of information) if the letter requesting information comes from your attorney. As soon as you have received an actual copy of the trust, you and your attorney will be better able to review it so you and he/she can attempt to determine what it is that you are entitled to and not just depend on what someone told you, which may or may not be correct.

 

Your attorney can also review the history of what has been done with the trust to determine if your sister's actions have been correct or not.

 

Find a trust attorney who practices in the city of the same county in Arizona where the death occurred so that you can get your questions answered by consultations AND get a copy of the trust and then you will know how to proceed.

 

Sorry that this is a somewhat messy situation--people get greedy and selfish when it comes to money.

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Sorry, I was not clear.  My sister lives in Mississippi and I live in California, right on the border of Az. I asked if I could file in the 1st Az town because there is a small Az town  5 miles from where I live, but the county in which the trust is connected to is about 5 hours away.

 

Just as an aside, not every "small town" has a court.

 

In any event, I would suggest conferring with a trust attorney in AZ (anywhere in AZ would be fine).  It may be that, if there is something to sue over, you'll have to do it in MS.

 

 

 

As far as the accountant, he is important because he knows exactly how much money and assets my grandmother had ( estimated over a 2 million dollar estate, and that is being conservative)

 

You didn't answer the questions I asked.  In your original post, you wrote that your "grandmother's accountant . . . was supposed to be used . . ., but [that your] sister did not use him; she hired the attorney instead."  I asked you why you think she was "supposed to" use the accountant.  You didn't answer that.  I also indicated that accountants and lawyers are not interchangeable.  While it certainly may have been advisable for your sister to consult with and/or obtain records from the accountant in question, based on what you've written, there's no reason to believe that your sister could not properly have retained a different accountant or no accountant at all to assist her in her role as trustee.

 

 

 

my sister complicated things by filing a petition against our now deceased mother.  My sister had gotten upset that our mother was given more in the last amended trust document, so she took our mother to court.  In doing so, accounts were misappropriated because their was confusion about 2 accounts: one being a Bank One bank account, which was my mothers transfer of death account and the other a Bank One Securities account, which had beneficiary distribution funds.  The court was only told about the Bank One Securities account, thereby believing this was the transfer of death account.  Based on that belief, they split that money between my sister and mother.

 

This is all quite unclear, but it appears that some of the issues about which you are concerned were previously ruled on by a court.  If that's the case, then you're not going to be able to relitigate those issues (even if there was evidence that should have been brought to the court's attention but wasn't).

 

If you want advice about how to proceed, you're going to need to consult with an attorney as recommended and will need to provide the attorney with, at a minimum, a copy of the trust instrument and all relevant court orders.

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Isn't the duty of the trustee, my sister, to show loyalty to the beneficiaries, follow the trust and protect it?

 

Roughly, yes, but assessing what that means in any given factual scenario requires knowledge of all relevant facts.

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Please calm down and do not assume that the trustee has committed a breach of fiduciary duty just yet.  You are not fully informed about trust matters and you need to do a bit of research first before you make assumptions.  Do a search engine search to get the definition of "residual beneficiaries" so you can get a better understanding of what a residual beneficiary is--residual beneficiaries get the residue from the trust--what is left over, if anything, after specific gifts have been distributed.  You may get nothing at all, or a windfall, depending on how the trust is written and what is in it.  So your sister may be following the instructions of the trust so far.

 

 

First, I would like to thank everyone for taking time to read and post.  In response to the post above, my grandmother's trust originated in 1978 and she amended throughout the years.  She had very clear gift amounts set for 20+ years and upon her death, only half of the gift amounts were paid out.  I, for one, was supposed to get 40,000 when she died and I have only received 20,000.  My 3 sons are supposed to get 40,000 each at the age of 24, and I have been told they are only getting half too.  The other beneficiaries have only gotten half of there intended gifts as well.  This is 200,000 not going to where it was supposed to go!  How can she get away with that?????!!!!!

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You are not going to get any resolution to this situation unless you retain the services of a trust attorney.  Having an initial consultation for one hour is not going to be expensive (and is sometimes even free, or he/she might hold off on charging you a fee until you actually receive proceeds from the trust) and can help you determine how to proceed--this is not a do-it-yourself project.  Now that you have reported significant details in your latest posting that did not appear originally, it appears that you have been seriously misled/deceived.  After your attorney asks for the yearly accounting statements and the trust income tax returns you are entitled to, you will be able to see for sure whether or not there was enough money in the trust account to pay out the full $40,000 instead of the $20,000 payout.  Attorney will also be able to determine whether a trustee's bond was posted or whether the trust exempted such bond from being posted; perhaps a breach of fiduciary duty has occurred here.

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If evidence is found that a breach of fiduciary duty occurred, ask your attorney if it would be possible to perhaps have your attorney negotiate terms with trustee, something like if she pays out the monies that are due to the beneficiaries then you will agree not to file charges against the trustee, in order to avoid a lawsuit.  If a breach of fiduciary duty goes to court it will be very costly for both sides in attorney fees.

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