Buffington Law Firm’s trust dispute attorneys have frequently assisted clients in dealing with problems involving the removal of problem successor-trustees or the need to force the dissolution of a trust. One form of trust that is particularly prone to trust disputes are so-called “Dynasty Trusts.”
A “Dynasty Trust” is a trust that is designed to live on after the trustor or trustors pass away rather than simply act as a vehicle to disburse the trustors’ estate after they die. Most trusts are designed to promptly disburse a trustor’s assets — typically but not always simply dividing the trustors’ estate among the trustors’ children and then dissolving. A Dynasty Trust, by contrast, is designed to keep the now dead trustors’ estate intact, and typically distributes income only to the beneficiaries. The basic notion is that the trustor or trustors (the people who originally created the trust estate) wish to exercise what lawyers sometimes call “dead hand control” over the beneficiaries. As one trustor allegedly said, a Dynasty Trust is designed to allow a dead trustor to exercise “control over the children from the grave.”
Dynasty Trusts are prone to problems which can be vexing to the beneficiaries. Often the successor-trustee of the Dynasty Trust will “milk” the trust for trustee fees. Other times the trustee favors some beneficiaries over others, exercising his or her “discretion” as trustee (Dynasty Trusts often provide for a wide latitude of discretion for the successor-trustee) in a way that beneficiaries believe is unfair. Self-dealing by trustees is common, where trustees sell trust assets to themselves or their relatives for knock-down prices. Usually in these situations the trustees utilize the financial resources of the trust to retain aggressive legal counsel with the objective of keeping the beneficiaries in check. It is not uncommon for trustees to use trust legal counsel to harass beneficiaries. Thus, the successor-trustee is essentially using the beneficiaries’ own money to retain legal counsel against them.
When these situations arise the beneficiaries need to take action to either dissolve the trust or, at a minimum, remove the problem successor-trustee. This can usually be done if the situation warrants it. Buffington Law Firm believes that the Probate Courts are increasingly attuned to the problems of bad trustees and poorly designed trusts. If you are faced with these kinds of problems, we invite you to contact us for a free legal consultation directly with one of our experienced trust dispute attorneys. All calls are completely confidential and there is no obligation.