Who Has More Rights Trustee or the Beneficiary? – Overview
Comparing a beneficiary and a trustee for any particular trust takes work to determine who has more rights. Both of them have different responsibilities, power, and roles.
A trustee can administer the entire trust and manage the affairs. They are also supposed to act in the best interest of the beneficiaries. However, a beneficiary needs more control over trust management. They are always entitled to receive their allocated funds.
General Rights of a Trustee
Here are some general rights of a trustee –
- They have the power to hold, connect, and retain trust.
- A trustee has the power to deposit and invest trust funds.
- As a trustee, you can accept additions to the trust property.
- A trustee can control, manage, decide, exchange, improve, partition, or abandon the trust property.
- They can mortgage, encumber, or pledge a trust property.
- As a trustee, you can borrow money for your trust, which can be repaid later from the trust itself.
- You can insure the trust property against any loss or damage.
- You have all the legal titles t the trust, and you are able to enforce different legal rights over the assets.
- You are entitled to hire investment advisors, attorneys, accountants, auditors, or other agents to assist the trustee in performing all the administrative work.
General Rights of a Beneficiary
Here are some general rights of a beneficiary:
- A beneficiary should receive a copy of the trust document.
- They have the right to get timely distributions, as per the terms of the trust.
- If they want, they can challenge the accountings.
- They can write a petition to suspend or remove their trustee if they violate any terms and conditions of the trust.
- Beneficiaries may not be able to manage or control their trust, but they must be informed about all the details of their trust.
- They should know all the financial affairs of their trust, including expenses, income, and distribution.
Can a Trustee Override a Beneficiary?
When a beneficiary requests something not under the terms of the trust, a trustee has the power to override the beneficiary. According to California Probate Code § 16000, a trustee should administer and manage the trust as per the terms and conditions of their trust instrument. It gives them a right to disagree with the beneficiary when they disagree with any outlined terms in the trust. A trustee can avoid the beneficiary’s wishes if they are violating the terms and conditions of the trust.
However, if the terms and conditions of some trusts are unambiguous and complicated, a trustee can always seek help from legal counsel. They must consult legal counsel before making a decision. A trustee can also file a petition to the probate court for assistance if they can not resolve the ambiguity without the beneficiary’s help.
Can a Beneficiary Override a Trustee?
Generally, a beneficiary can only override a trustee when they cannot maintain the terms and conditions of the trust instrument. They will have the power to override if the trustee violates any trust terms or cannot fulfill the fiduciary responsibilities.
Generally, a beneficiary does not have the right to do anything against the trustee, even if they disagree with the trustee’s decisions. However, they have the legal right to remove or suspend the trustee if they are abusing their power or using the trust for personal gain.
How can a Beneficiary or a Trustee Protect Themselves?
A trustee or a beneficiary can always seek assistance from a trust attorney. An experienced trust attorney can help them to protect themselves and lead the best way to take the next step.
A lawyer can guide a trustee to understand their responsibilities and make them aware of all their trust instruments and obligations. A new trustee can seek guidance from their attorney to avoid complications and troubles. This way, a trustee can ensure to fulfill all the necessary requirements of their position and avoid making any mistakes.
When a beneficiary files any dispute about the trustee, the attorney can not take any decision immediately. A probate attorney always observes and reviews the trustee’s actions first. They can only help the beneficiary to sue or remove the trustee in case of any misconduct or major irresponsibility.
Appointing an expert and an efficient attorney can always make the journey smoother for both the trustee and beneficiary. An attorney can guide them through every step, help them avoid any complications, and prevent them from making any mistakes.
A trustee and a beneficiary both have major roles and responsibilities. Both have to work according to the terms and conditions of the trust. When one of them violates the legal terms of their trust it gives the other person a right to override. A trustee and a beneficiary should work together and seek help from their personal attorney to avoid making mistakes and meet their requirements.