This column first appeared in the San Antonio Express News and other Hearst Newspapers on January 12, 2021.
Dear Mr. Premack: My older brother listed me as a successor Trustee in a new Living Trust signed by him and his wife. They did not ask me, I did not sign, and they just now told me. They are Trustees as long as they are healthy and alive, but the Trust says I must manage their finances if they are ill or after they die. I told them I would rather not have that responsibility and asked them to remove my name, but they said I can just decline later. I spoke to the other successor they listed, and she also said she was not asked and does not want the job because their daughter / beneficiary has drug and criminal behavior issues. When they die, how do I decline? Can they legally require me to manage the Trust for their daughter, or am I able to decline the job? H.C.
A Living Trust Agreement can be established to accomplish a wide variety of goals. The creators of the Trust with their estate planning attorney 1) itemize the tasks needed to reach those goals, and 2) choose the people who they feel are capable of and willing to achieve those goals. For instance, the Trust may specify that the creators’ assets are held for the benefit of the creators during their lifetimes, then after their deaths are to be held for the benefit of their adult children.
Often, when the children are stable responsible adults, the Trust will instruct that distribution of assets be made directly to them. The Trust has then fulfilled its goal by moving the assets to the next generation. But when the children are under-age or are not stable or responsible, the Trust can specify that the assets remain under the Trustee’s control to be distributed only for certain needs at certain times. Clearly that scenario is a much bigger challenge for the selected successor Trustee. It is the position into which you have been placed.
Your brother and his wife should have asked for your consent before listing you as successor Trustee (the same goes for the second successor you mention, who also wishes she had been allowed to decline). When they created the Trust, they were establishing a legal framework built on the relationships and bonds they have with the people charged with fulfilling the Trust’s goals. Logically they should confirm those people are willing to do the required work.
Yet you are listed without your consent. What can you legally do? First, you need to inform the Trust creators that you do not want the job. You have done so. They elected to make no changes, a poor decision that puts the whole framework of their Trust at risk. They should remove you because they need successor Trustees willing to follow their instructions to accomplish the goals set out in the Trust Agreement.
Second, if they do not remove you, then when they die you must avoid acting in a manner that creates an “acceptance” of the role of Trustee. Do not sign the Trust Agreement. Do not exercise any powers given to you under the Trust Agreement. Notify the Trust’s beneficiaries that you decline. Notify the other successor Trustee you have declined. (Just inspecting the trust assets or acting to preserve the trust assets is not “acceptance” if you otherwise promptly reject the role of Trustee.)
Third, after you decline, the other successor Trustee must decide whether to accept being Trustee. If she also declines, the law specifies that “any interested person” can petition an appropriate court to appoint a different Trustee.
Your brother and his wife should not want their Trust to end up in court. They should remove from the Trust anyone unwilling to serve. If there is no one else willing to be successor Trustee they should interview the Trust Departments at several local banks. Corporate fiduciaries charge specific fees but provide professional and reliable trust management. When there are no individuals willing to or capable of being successor Trustee, a bank may be the ideal alternative.
Paul Premack is a Certified Elder Law Attorney, handling Wills and Trusts, Probate, and Elder Law issues. He is licensed to practice law in Texas and Washington. View past legal columns or submit free questions on those legal issues via www.Premack.com.