The Role Of A Successor In California Trust Administration

In this article, you can discover:

• The responsibilities of successor trustees in California trust administration.
• Legal duties including trust terms, probate code, and prioritizing beneficiaries.
• Identifying assets through searches, records, and trust attorney assistance.

What Are The Main Responsibilities Of A Successor Trustee In California?

In California, the responsibilities of a successor trustee in trust administration vary based on the trust’s specifics, its current phase, and the number of trustees who initially created the trust. For instance, in a marital trust, a common type in California, when one spouse (the decedent) passes away, the surviving spouse becomes the successor trustee.

This individual then undertakes tasks such as appraising real estate, inventorying marital assets, and collaborating with legal and financial professionals to optimize tax benefits for the surviving spouse or their heirs. This process may also involve reallocating assets to other trusts or making initial distributions due to the decedent’s passing.

However, when both spouses have passed or in the case of a single person’s trust, the successor trustee’s primary role is to evaluate the trust’s assets and liabilities, ensure all expenses are settled, and distribute assets to beneficiaries as per the trust’s guidelines and probate code.

What Other Legal Responsibilities Do Trustees Have In California?

Trustees must prioritize adhering to the trust’s language. The trust document can contain various wishes and directives from the creator. Potential trustees should assess the trust and the estate’s size and complexity before accepting the role. If they feel they cannot fulfill the duties, they should decline.

Those who choose to serve must follow both the trust’s terms and the probate code. As fiduciaries, trustees hold a significant responsibility to manage and distribute funds to beneficiaries, always acting in their best interest.

What Steps Should A Successor Take To Identify And Gather All Trust Assets In California?

Generally, identifying trust assets is straightforward. If an individual has established a trust under an attorney’s guidance, they’ve likely been advised to title all assets under the trust. Usually the person or entity who a decedant has chosen to serve as trustee has been advised of the decedant’s assets during the lifetime of the decedant.  Sometimes the decendant will have listed their assets in the trust itself or with their trust records.  Additionally, the law firm who assisted in the establishment of the trust and funding of the trust usually has records of trust assets.  The decedant’s tax professional can also be a great resource if a trustee is trying to identify assets.  There are also other ways in which trust assets can be identified.  For example, trustees can locate trust assets by searching for the trust’s name in real estate records or bank accounts. If records are unclear or incomplete, a trust attorney who works with trust administrations can assist the trustee in identifying assets.

How Can A Successor Handle Disputes Or Disagreements During The Trust Administration Process?

It’s common for a successor trustee to also be a beneficiary, especially if they are a family member. To prevent disputes, it’s essential to maintain transparency and open communication. When drafting a trust, sometimes a settlor (creator of the trust) will  involve the most responsible and capable beneficiaries in the trustee role, ensuring there is an opportunity to participate in the administration of the trust. This approach, combined with regular updates, can significantly reduce disagreements between beneficiaries and foster a smoother administration process.  Of course, not every situation is the same so there are plenty of instances where a settlor will choose one trustee simply for the reason of location and convenience.  Whatever the number of trustees, openness and transparency with all of the beneficiaries during the administration process is very important. For more information on the Role Of A Successor In Trust Administration, an initial consultation is your next best step.