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hey estate planning attorney paul rabale here and in this video we're going to talk about five specific duties that a trustee of a trust has so you know i get asked questions like this all the time you know somebody comes in they say paul i got i got a question i need to ask i'm involved in a trust i'm a beneficiary of a trust and so and so is the trustee so and so might be the beneficiaries mother stepmother stepfather father cousin aunt uncle brother um corporate trustee at um and so they'll say you know paul let me tell you what the trustee did they did this and then and then paul can can they do that so this addresses those trusty duties and um and and again you know what duties a trustee of a trust has now a couple of things at the outset um many trust instruments define what the trustee duties are there's likely to be a section in the trust instrument that defines what what the duties of the trustee are and that that section might be a page long or it might be 30 pages long or in in absence of specific trustee duties in the trust instrument then you have to look to you know your the the trust law to define what those trustee duties are some some trusts will have language that says the trustee is bound by the duties that are defined in the applicable you know trust law so you have to look at all of that now i will say that provisions and a trust that limit a trustee's trustee's duty of loyalty to the beneficiary are are typically ineffective a couple of other points and as i give you go through these examples know that this these trusty duties generally don't apply when someone has a revocable trust a lot of trust out there where the person setting up the trust they transfer assets to their trust they are the trustee the trust is revocable a lot of these trustee duties don't apply to that trustee of a revocable trust because quite frankly the trustee who is also the set lawyer can revoke their trust put everything back in their name so so there really are no uh duties to others that the trustee of a revocable living trust has but nonetheless let me go through and so in fact let me go over maybe a couple of scenarios where these duties do apply so oftentimes um maybe grandfather either left as a bequest assets to a trust let's say for his grandchildren and grandfather named his son as the trustee of that trust and the grandchildren are adults so the son is going to have a duty that we'll talk about here in a minute to um you know preserve assets for the benefit of the grandfather's grandchildren and we'll talk about what those duties are another common example is when a husband for example leaves his estate when he dies to a trust for perhaps his wife for her lifetime and then perhaps when his wife lot dies back to his children and his wife his surviving wife may or may not be the mother of his children so whoever the trustee of that trust is must abide by the duties that i'm about to talk about here in a moment and that trustee of that trust might be his surviving wife might be one or more of his children might be some other third party might be a corporate trustee but they're bound by these duties so let me go through five particular duties that a trustee of a trust has the first one i'm going to talk about is a loan and our trust law is specific that says an individual trustee shall not lend funds to himself as relative employer employee partner or business associate unless the trust instrument provides otherwise so if you're the trustee of a trust and there's a million dollars in the trust you can't just say you know what boy i could use maybe a half a million dollar loan pay off some debts i'll get around to paying that back to the trust when i get around to it can't do that the only way you can as a as trustee you can personally borrow money from the trust is if the trust instrument provides it and because you have a duty of loyalty to the beneficiary if you're going to do that because the trust instrument provides it it better be an arm's length transaction you know appropriate uh collateral interest rate that kind of thing but uh so really it's frowned upon loans um by a trustee from the trust number two is a sale and so again an individual trustee shall not directly or indirectly buy or sell property for the trust from or to himself or all those other people his relative employer employee business associate associate and partner unless the trust instrument provides otherwise or it's authorized by a court now you see this one apply from time to time and a common example is mom and dad died they had a trust they both passed away they have four children they leave the trust assets to the four children equally um oldest child is the trustee of that trust now that mom and dad have passed away and let's say oldest child says i'd like to buy mom and dad's house from the trust and so perhaps either trust law or the trust instrument may prohibit that if it does then i think what's oldest son would have to do is he would have to distribute or transfer that home from the trust to the four children so that the four children would be co-owners and then oldest child could purchase each of his siblings one-fourth interest uh you know from that sibling of his so that might be the way to kind of get around the i can't buy property from the trust provision trust duty number three the accounting requirements this requirement is almost never met by individual trustees so a trustee has a duty to keep and render clear and accurate accounts of the administration of the trust and at least once a year that trustee must render a clear and accurate accurate account covering his administration for the previous year so i've had people come into the office paul i'm a beneficiary of a trust and my my brother is the trustee i haven't heard from him in seven years i don't know what he's doing he probably squandered the trust blah blah blah crimea river i'm like man seven years and you haven't heard a word uh what are you doing waiting seven years to uh look into getting information about this trust that you know you are involved in so be aware of that most in a lot of individual trustees aren't even aware that they have this accounting requirement so hopefully this video will make both trustees and beneficiaries aware of the trustee accounting requirement trustee duty number four the duty to furnish information so the last one was about an annual accounting and so this one is a trustee shall give to a beneficiary upon his request and i'm gonna refer to actual the actual provision of our trust code whoops let's see drop the old scotch tape a trustee shall uh give to a beneficiary upon his request at reasonable times complete and accurate information as to the nature and amount of the trust property and permit him or a person duly authorized by him to inspect the subject matter of the trust and the accounts vouchers and other documents relating to the trust so again another scenario where if you haven't heard from that trustee in let's let's call it years at you can require at reason and request at reasonable times all of that you know information that you as a beneficiary would like to have from the trust all of the accounts all of the statements now so if you haven't heard from the trustee in you know uh three years i would say you're contacting the trustee and saying i'd like to see a copy of all the accounts and and other relevant information i would say if you haven't heard from them in three years at that that is a reasonable time to request that now if you go every week and say i want to see a printout of all the transactions every single week that's that may not be reasonable so it's kind of limited to this you're required i mean your your that that trustee shall give to a beneficiary upon his request at reasonable times complete and accurate information and then number five i'm going to refer to the trust code again it's that just kind of that general prudent administration standard because our legislatures they can't legislate every single action that a trustee might take so we have these fairly general prudent administration statutes that's that say a trustee shall administer the trust as a prudent person would administer it in satisfying this standard the trustee shall exercise reasonable care and skill considering the purposes terms distribution requirements and other circumstances of the trust so that provision basically says a trustee has a duty to do what a prudent trustee would do because there's so many different things that a trustee could do they can't legislate everyone so they of course make sense that they would have this prudent administrator rule okay there's a few other trustee duties but those are the ones i get questions about the most so here's the deal if you if you have a question if if you are perhaps a beneficiary of some type of irrevocable trust and you have a question as to what the trustees duties are i would number one look at the terms of the trust and if you don't have a copy of the trust shame on you that might be the first thing you'll want to request because every beneficiary is entitled to have a copy of the trust instrument so number one look at the terms of the trust instrument number two if the trust instrument does not address what that trustee's duty is or at least the one that you're inquiring about then look to your state's trust law to see if your state's trust law addresses that particular trust trustee duty that you're inquiring about so that ought to get you straight and if again if you're at the if you're at the point of questioning a trustee's duties then you're probably going to want to be in the mode of making sure that you obtain the required annual accountings from the trustee you may at other reasonable times want to request other information that would give you the peace of mind that hopefully that the trustee is performing as that trustee should because they're bound by that prudent administration rule to do what a prudent trustee would do so that gets you started on trustee duties and the other thing that you want to do is is really two things one smash the like button turn it from gray to blue that'll tell youtube show my video to more people and then number two if you haven't already subscribe and hit the notification bell that way you don't miss anything as i keep cranking out more estate planning trust probate estate settlement videos so you can make much better informed decisions as you decide what to do for yourself and for your family we'll see you next time