Many people find estate planning stressful for a variety of reasons. Some are challenged by the notion of contemplating their own mortality, while others struggle to decide whether their children should be treated equally in their asset distribution plan. While those matters are certainly important, the ramifications of estate planning choices are long-reaching and can have enormous consequences. This may be especially true when it comes to choosing an estate executor or trust administrator.
These individuals serve as fiduciaries, meaning that they must put the interests of the estate and/or the trustee’s first when making decisions. They are disallowed from acting in their own self-interest, and their decisions must not be so grossly inappropriate so as to put the estate or trust at unnecessary financial risk.
Yet, all too often breach of the fiduciary responsibility occur, leaving surviving family members feeling cheated. As stressful as this may seem, these individual should take comfort in the fact that they may have legal options available to them. One of the most powerful is to file a lawsuit against a fiduciary, but success depends on proving three elements:
- The fiduciary duty was actually created: In the case of estate planning, this is almost always certainly the case. There should be a paper trail of legal documentation showing who was named as an estate executor or trust administrator, which can be utilized to show that a fiduciary duty was owed.
- The fiduciary duty was breached: Breach of the fiduciary duties can occur in a number of ways. Money can be misappropriated, key information can be withheld from beneficiaries, and important facts can be misrepresented. All of these issues may constitute breach, although it will depend heavily on the facts at hand.
- Damages must have been suffered as a result of the breach: Here, beneficiaries must be able to show that the fiduciary’s actions caused them some sort of harm, which is usually financial in nature. If money from a trust account was squandered, then the damages may constitute that money and any potential growth it could have seen over the span of time that it was missing. Again, this will be a very fact-sensitive issue.
Of course, proving a breach of fiduciary duty isn’t always easy. In fact, it can be quite challenging to demonstrate that a fiduciary acted in a way that was contrary to a beneficiary’s best interests. It’s somewhat subjective, after all, which is why it is often to have legal assistance when approaching these matters. A competent legal professional may be able to help present one side of the story in a persuasive fashion that maximizes and individual’s chances of success, which may lead to the recovery of compensation and accountability.