Is that legal for the successor trustee to change the distributions like that?

If the trustee chooses to distribute assets in a way that's contrary to the provisions that were set out in the instruction document ...

... it seems to me that s/he'd better hope that no one chooses to challenge the way in which s/he chose to make those distributions ...

... 'cause if someone does - I hope that the trustee has pretty deep pockets (or doesn't mind living in a much smaller house ... or maybe a rental?).

And travel using a bicycle or transit.

ole joyful

It's illegal as far as I know!

Well the problem is that Trusts have no court supervision. So the objecting heir has to go into court, pay for their own attorney and seek an order from a judge. I know how to solve the problem, and we do see it frequently in court. What I was asking is--does this happen often in your area? I know how often it is happening in SoCal courts because thats where I practice.

When I re-read your original post just now, I realized that I hadn't answered your question.

Unfortunately, I have no answer for you, for I don't know, one way or the other.

Sorry.

ole joyful

Often laypeople who are appointed as trustees don't understand the fiduciary concept. I know that people like to use trusts to avoid probate, but probate does provide more protection for having your wishes carried out. Probate also has a cleansing effect in that creditors must present their claims or are barred from asserting them (proper notice is required). Probate is not always expensive and does have its advantages. Trusts certainly have their place, but I think they've been oversold.

Trusts can be very useful in estate tax planning, but using a trust solely to avoid probate is not always wise.

I think this is a problem that is going to grow over time. Trusts were really oversold in the last twenty years. With the easing of estate taxes most trusts aren't necessary.

Many people do not truly understand the issues of trustee fiduciary responsibilities, from either side of the equation. As far as I know (state laws differing as they do) it is up to the other heirs to bring suit against the trustee if they feel the trustee has failed his/her fiduciary duty. Expensive, yes; which is why people should give more thought to who they designate as trustee. It is a situation ripe for petty abuse.

I remember hearing an old proverb - "Never say you know a man until you have split an inheritance with him." Still true!

I can't comment on the idea that trusts have been oversold. I've had dealings with three trusts and am convinced they keep things simple and tidy in a time when you don't want complicated and messy. There was no oversight as to the distribution, successor trustee was not required to make any kind of accounting but so as to avoid even the slightest hint of impropriety, the trusts were dealt with as written. Simple and no grounds for challenge.

I imagine it all becomes less clear cut (with a trust it could be as much a moral issue as a legal one) when there are true special needs or when someone's perceived "special needs" aren't fulfilled by a bequest or when too many people know the terms before hand and are quibbling about or dividing up the estate and getting to despise each other while the benefactor is still alive. Money and the idea of inheriting money can really turn some people.

The trust is a very good vehicle when and if it's the right one for you. Always extremely wise, as noted above, to pick a successor trustee you can trust without reservation. If someone's uncomfortable or incapable of acting as trustee, they can always resign - their appointment isn't chisled in stone - in favor of another person or institution who is.

Not being in the legal profession, it'd be a little difficult to see any trends in this. In my family, and now with a host of deceased elderly relatives, I've never known of any challenge to a will or trust.

One should not hope to manage from the grave, whether by will or trust.

Working in a financial planner's office, I've known of several serious family disputes over trusts. It's a real nightmare all the way around for everyone.

The reason I feel trusts have been oversold is the example of my in-laws. They didn't really need a trust, they only have one child! Totally unnecessary, could have just as easily been spelled out in a will. Inheritance spouse to spouse would have been LESS trouble than the trust was. Their list of successor trustees and contingent beneficiaries was 25 years out of date. It took six hours of consultation between us, my MIL, and the estate attorney to figure out the best way of getting them updated, since half the estate was now Irrevocable.

Yes, we have a trust ourselves. But we have no children, which as our estate attorney pointed out, actually complicates matters. We have designated two people as heirs, one of whom isn't blood related at all. At the same time we are disinheriting people who have equal or stronger blood relationships to us.

What our experience with my MIL's trust has taught us is that keeping one's trust updated is critical, and far too easily overlooked. Trusts do not work on common sense, they work according to the LAW, and this can trip up a lot of folks unwittingly.

In some states, the trustees still have to file papers with an attorney and get the stuff approved by a court. Usually the attorney looks the will over, help file papers, present the will for probate etc. And if he/she sees anything unusual they will check it out. I had to do this in CA. I could not just change things around.

Don't wills also have a "trustee"?

Wills have a designated (or appointed) "executor".
Trusts have a "trustee".

The term executor is used for the person responsible for handling the probate of an estate. Probate involves the court overseeing the distribution of the estate according to the person's Will.

A trustee is the person responsible for managing a Trust. A trust is a separate legal entity formed prior to death in order to avoid probate.