After a person who has created a living trust dies, a fiduciary duty arises for his or her successor trustee to properly administer the trust. This fiduciary duty is the highest and strictest duty of care recognized in the law of the State of California. The named fiduciary often is not a professional. He or she might be an adult child, a close family friend, or a relative. Although the administration of a trust has certain advantages over administering over a will, it is still a tedious endeavor from the start.
Fulfilling these and other important duties involving the administration of a trust is critical to effective distribution of a trust. Although administration might seem rather simple, it is a highly complex endeavor that should be placed in the hands of experienced trust administration attorneys.
All assets in the trust must be brought under the control of the successor trustee. This is known as the process of marshalling assets. Assets in the trust should be secured by the successor trustee as soon as possible. They must then be inventoried, and present-day fair market values on certain items might need to be established.
A trust is a legal document that acts much like a will by documenting how you want your affairs handled after you pass away. Trusts are placed in the control of a person or other entity, known as a "trustee," who is in charge of handling the property according to the wishes of the deceased. Please note, there are various types of trusts, each of which has its own requirements and benefits.
In California, the trust administration process usually begins the moment the trust is created. During the drafting of the trust, the trustor will designate a person to handle their trust a position known as the "trustee"—as well as someone to administer the trust after their death. This position is known as the "trust administrator." These positions are often filled by the same person or company. The trustor may also designate beneficiaries who may come into the trust at a certain future date.
Trustees can be granted immediate administration over a trust or they could be named a successor trustee in which case they would assume their role as administrator after the trustor passes away. If the decedent left no will designating a trustee, then his or her next of kin may file a petition with the court to be appointed as administrator of the decedent's estate. The court can also designate an administrator from the public administrator's office if no one petitions for this position.
The duties and responsibilities of a trustee are outlined in the trust itself, as well as under California state law. It is the duty of a trust administrator to ensure that the decedent's will is followed after their death and that their property is distributed according to the same will.
Trustees must be aware of both their statutory duties and restrictions, as well as those listed in the trust in order to avoid violations. Otherwise, a Trustee's acts could be determined as non-binding and may be disputed during the estate trust administration process, often resulting in trust litigation.