QUESTION

Does the Distributor of a Living Trust decide what the beneficiaries get if the Trust does not specify?

Asked on Jan 26th, 2014 on Trusts and Estates - California
More details to this question:
My brother is the Distributor of Mother's Trust. We are the beneficiaries. The Trust does not designate who gets what.
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1 ANSWER

Taxation Attorney serving Santa Monica, CA at Lyster, Inc.
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The person who is responsible for distributing assets from a trust is called the "Trustee."  The Trustee is required to distribute assets in accordance with the terms of the trust.  The Trustee is also reponsible for managing those assets until they are distributed.  Very often, the person who makes a trust (known as the "Settlor" or "Grantor" or "Trustor" - here your mother) will not specify specific asserts to go to specific beneficiaries; instead, the Settlor will trust the Trustee to make the choice and to give the beneficiaries their shares based upon asset value.  Or the trust may permit the Trustee to sell asserts and just distribute cash.  The Trust may put limits on what the Trustee can and cannot do, but in my experience this is not often done.  The law does require the Trustee to act fairly and in the best interest of the beneficiaries - two of the Trustee's "fiduciary duties." The law does not require the Trustee to consult with the beneficiaries concerning their preferences, but in my opinion, and to avoid problems, it is usually prudent for the Trustee to do so.
Answered on Jan 26th, 2014 at 3:57 PM

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