Even though a Trustee may have absolute discretion, a Trustee must handle the Trust prudently, administer in good faith, and provide timely notice to beneficiaries. Pursuant to section 736.0804, Florida Statutes, a Trustee shall administer the Trust as a prudent person would and should consider various factors such as: (a) purpose of the Trust; (b) the terms of the Trust; (c) what are the distribution requirements; and, (d) other circumstances which pertain to the Trust. In order to satisfy this standard, the Trustee shall exercise reasonable care, skill, and caution.
IS THE TRUSTEE ADMINISTERING THE TRUST IN GOOD FAITH?
Whether the breadth of discretion granted to the Trustee is “absolute,” “sole,” or “uncontrolled,” the Trustee is still required to exercise his or her discretionary power in good faith as well as in accordance with terms and purposes of the Trust. Also, he or she is to exercise good faith in the interest of the beneficiaries. See §736.0814(1), Florida Statutes (2013).
Further, no matter how broad the discretion, a Trustee is not relieved of his or her duty to exercise good faith. A more recent case in a sister district supports further that absolute and discretionary powers do not relieve the Trustee from exercising good faith in administering the Trust.
HOW DO I KNOW A BREACH OF FIDUCIARY DUTY HAS OCCURRED?
A Trustee has a fiduciary responsibility to administer the Trust when a fiduciary or trust relationship exists. A breach of fiduciary duty occurs when a trustee is suspected of:
a. Failure to make proper or timely distributions;
b. Failure to make proper or timely accounting;
c. Failure to administer the trust in a manner required by the trust document;
d. Failure to follow the prudent investor rule or making improper investments;
e. Self dealing or conflicts of interest;
f. Excessive trust compensation.
The cause of action for breach of fiduciary duty elements are: (1) the existence of a duty, (2) breach of that duty, and (3) damages flowing from the breach.
FAILURE TO MAKE PROPER OR TIMELY ACCOUNTING
Failure to make proper or timely accounting occurs when the Trustee fails to keep the qualified beneficiaries informed once he or she accepts the Trust. According to section 736.0813(1)(a) and (b), a Trustee shall give notice to qualified beneficiaries within 60 days after acceptance of the Trust, after the date the Trustee acquires knowledge of the creating of an irrevocable trust, or the date the trustee acquires knowledge that a formerly revocable trust has become irrevocable. A Revocable Trust may become an Irrevocable Trust upon the death of the settlor or otherwise. The Trustee is required to provide timely notice to qualified beneficiaries as part of his or her responsibilities and duties.
In addition, qualified beneficiaries are entitled to relevant information regarding the Trust assets and liabilities, along with the particulars pertaining to administration of the Trust. After receiving the accounting, the qualified beneficiaries have six months to object to the account by filing an action in probate court.
If you have any concerns regarding the appointment of a Personal Representative of an estate or feel you may be more qualified as a Personal Representative over another individual, contact Florida Probate Litigation Attorney Thomas Upchurch to discuss your probate litigation matter at (386) 272-7445 or email him at tupchurch@upchurchlaw.com for your initial consultation.
Florida Estate Planning Attorney Thomas Upchurch serves the entire state of Florida, serving primarily in vicinities of Central and North Florida Areas which include Daytona Beach, Port Orange,Deland, Ormond Beach, Jacksonville, Palm Coast, Orlando, Saint Augustine, and New Smyrna Beach.Areas he serves in South Florida include Miami, Ft. Lauderdale, Coral Springs, and Coral Gablesand in West Florida include Tampa and Clearwater. Even if your city is not listed, Attorney Upchurch may still handle your matter.
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FULL DISCLOSURE
This blog post only reflects my personal views in my individual capacity. It does not necessarily represent the views of my law firm or my past clients, and is not sponsored or endorsed by them. The case-specific information contained in this blog post is based solely on opinion, and is provided only for educational purposes and is not intended to provide specific legal advice. No representation is made about the accuracy of the information posted on this blog site. Blog topics may or may not be updated and entries may be out-of-date at the time you view them.
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