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Why a Trust Petition is Usually the First Step in a Trust Dispute.

by | Nov 13, 2022 | Trust & Estate Litigation, Trust Disputes

Trust disputes have become far more common in the past two decades as the Baby Boom generation (and others) have come to inherit much more commonly via trust.  In earlier decades many or most estates passed to the beneficiaries by will.  There are many differences between wills versus trusts (a full discussion is beyond the scope of this article), but perhaps the major difference from the beneficiaries’ perspective is the fact that trusts can and are normally intended to operate without any supervision or involvement by the courts.  Wills, by contrast, except in cases involving very small estates, must proceed through the court probate system in which the probate court supervises virtually every aspect of the estate’s disposition.  Thus, under normal conditions, the trustee of a trust can expect to exercise his or her duties to dispose of the estate without any court action, while the executor/executrix of a will operates very much under the probate court’s scrutiny.

These two approaches have many trade-offs.  The probate of a will can be a lengthy and expensive process (this is not always so) but there is some surety that matters will be handled properly by virtue of the fact that the probate court will be supervising the process of administration.  A trust normally avoids this process (indeed, most laypersons learn of trusts by being told that trusts enable you to “avoid probate”) because the default rule is that courts are not required to be involved in trust administration.  Indeed, the term “living trust” refers to the fact that a trust is “alive” before the trustmaker (“trustor”) passes away, and survives him or her after the passing.  The idea is that the trust owned the estate both before and after the passing of the trustmaker; only the trustee and the actions to be taken change upon the death, e.g. the usual duty of a new successor-trustee after the passing of the trustmaker is to distribute the trust estate assets. (A probate estate, by contrast, is created by the probate court once it admits a will to probate; thus the creation of a probate estate requires court action.)

Unfortunately, sometimes trust disputes arise, for all kinds of reasons.  This can be due to a misbehaving trustee, one or more unreasonable beneficiaries, or many other things.  When a person, such as a trustee or beneficiary, is involved in a trust dispute, unless it can be resolved informally and fairly quickly, it is almost always advisable to file a trust petition with the probate court.  A trust petition essentially is the first step to bringing the trust into the court system and placing it under the supervision of the probate court.  Sometimes this will result in the probate court exercising close supervision over the trust.  Much more commonly, the court will involve itself only in the narrow issues framed by the probate petition.  For example, perhaps the most common type of trust petition is a simple petition to compel a trustee to produce a probate code conformant accounting.  In a simple situation the Court might order the trustee to provide the accounting, the trustee might do so, the beneficiary might be satisfied, and that might end the Court’s involvement.  On the other hand, sometimes the facts and circumstances of the dispute might justify much greater involvement by the Court.  In such a case, the Court may end up exercising control of many or most aspects of trust administration.  As established in Schwartz v. Labow (2008) 164 Cal. App. 4th 417, 427-428], a court has broad equitable powers to issue any order to carry out its “express powers to supervise the administration of the trust.” [Schwartz, supra at 427-428].  This can involve suspension and replacement of the trustee, and many other things whereby the Court is deeply involved in the trust administration.

When a trust justifies and requires intervention by a Court, the first step is to file the appropriate petition.  This brings the trust into the Court’s jurisdiction.  Before that is done, normally the court system will have no involvement in trust administration.  If you have a trust dispute for which you require legal assistance, Buffington Law Firm’s trust dispute attorneys invite you to contact us for a Free Legal Consultation.  All consultations are with an experienced trust litigation attorney, are protected by the attorney-client privilege, and there is never any charge or obligation.