Trusts are such powerful and effective tools when they are used correctly. Litigation can still happen though, and usually for common reasons. Often, the litigation arises because families used the internet or an inexperienced attorney to put their trust together. In other cases, family disputes can arise even if the trust was expertly crafted. Being ready ahead of time can help reduce the chances of litigation.
The estate planning attorneys at Mark Harford Law can help you avoid most common causes of trustee disputes by drafting an appropriate trust from the beginning. In situations where it is already happening, we’re here to help resolve the dispute.
What Is Trust Litigation in Missouri?
Trust litigation is a lawsuit over a trust. It usually involves disputes about the administration of the trust or interpretation of its terms. It can also be a fight over the enforcement of the trust provisions.
These cases typically get filed in Missouri probate court, and could involve:
- Allegations that a trustee breached their fiduciary duties
- Disputes over how trust assets are being managed
- Challenges to the validity of the trust
- Conflicts between beneficiaries
- Requests to remove or replace a trustee
The Trustee’s Fiduciary Duties Under Missouri Law
Trustees in Missouri must follow the Missouri Uniform Trust Code (MUTC), which outlines several fiduciary duties. These include:
Duty of Loyalty
The trustee is required to act in the best interests of the named beneficiaries. They’re supposed to avoid conflicts of interest.
Duty of Impartiality
If the trust has several beneficiaries, the trustee can’t favor one over the others. The exception could be if the trust document specifically allows that type of treatment.
Duty of Prudent Administration
Trustees must manage trust assets with care, skill, and caution, including making responsible investment decisions.
Duty to Follow the Trust Terms
The trustee is supposed to follow the instructions of the trust unless they are illegal or the court says to do something else.
Common Causes of Trustee Disputes in Missouri
The most common causes of trust disputes include:
1. Alleged Mismanagement of Trust Assets
Beneficiaries might say that a trustee was:
- Making risky or inappropriate investments
- Failing to diversify assets
- Allowing property to fall into disrepair
- Mishandling business interests
- Failing to collect income owed to the trust
Missouri law requires trustees to manage assets prudently.
2. Lack of Transparency or Poor Communication
Trustees must keep beneficiaries reasonably informed about trust administration. Disputes often arise when trustees:
- Fail to provide accountings
- Delay responding to beneficiary questions
- Withhold financial information
- Make decisions without explanation
3. Self-Dealing or Conflicts of Interest
Self-dealing occurs when a trustee uses trust assets for personal benefit. Examples include:
- Selling trust property to themselves or a family member
- Paying themselves excessive fees
- Using trust funds for personal expenses
Because the duty of loyalty is strict, even the appearance of self-dealing can trigger litigation.
4. Disputes Between Co-Trustees
Trusts with multiple trustees can trigger disputes over:
- Investment strategies
- Distribution decisions
- Interpretation of trust terms
- Division of responsibilities
5. Disagreements Over Distributions
Beneficiaries may challenge a trustee’s decisions about:
- Timing of distributions
- Amounts distributed
- Whether conditions for distribution have been met
6. Challenges to the Validity of the Trust
Litigation may also involve claims that the trust is invalid due to:
- Undue influence
- Lack of capacity
- Fraud
- Improper execution
These cases often arise after the death of the settlor, when beneficiaries first learn the trust’s terms.
When Trust Litigation Becomes Necessary
Litigation may be necessary when:
- The trustee refuses to provide information
- Trust assets are at risk
- Beneficiaries suspect misconduct
- Co-trustees cannot cooperate
- The trustee ignores their legal obligations
When to Contact a Missouri Trust Litigation Attorney
Trust litigation is complex and requires a deep understanding of Missouri trust law. An experienced Missouri trust litigation attorney can:
- Evaluate whether the trustee has breached their duties
- Demand accountings and financial records
- File petitions to remove or replace a trustee
- Seek compensation for losses caused by mismanagement
- Defend trustees against unfounded allegations
Work with a Trusted Missouri Trust Litigation Lawyer
Trust litigation can be highly complex. It requires significant experience in this area of law that not every attorney is ready for. Let the dedicated estate planning attorneys at Mark Harford Law help you. Contact us today for a consultation.