Articles Posted in Trustees

Time Limitations for Proceedings Against Trustees: Discussing Failure to Account

An individual serving as a trustee owes certain duties to the beneficiaries of that trust. One such duty is the duty to account to the beneficiaries.  Failure to provide an accounting as required in § 736.0813, Fla. Stat. is a breach of trust by a trustee. Fla. Stat. § 736.1001(1).  A beneficiary can institute an action for an accounting and/or against a trustee for breach of trust, but the factual circumstances of the case may determine the time limitations for bringing such actions. These limitations are found in the Florida Trust Code under  § 736.1008, Fla. Stat. Under  § 95.11, Fla. Stat., the statute of limitations for a legal action alleging breach of trust or fiduciary duty is four years.

The Trust Code, specifically §  736.1008, Fla. Stat., provides further clarification as to how Chapter 95 applies in trust matters. Under § 736.1008(1), if the trustee issued a trust disclosure document that adequately discloses information, the four year statute of limitations applies, beginning on the date that the beneficiary receives the disclosure. For all matters not adequately disclosed in a trust disclosure document if the trustee has issued a final trust accounting, the trustee has given final notice to the beneficiary that the trust records are available, and has given written notice of the applicable limitations period, the limitation period begins on the date that the beneficiary receives the final trust accounting and notice. However, under § 736.1008(3), when the trustee does not provide a final trust accounting, or give notice to the beneficiary that the trust records are available, the applicable limitations period for a matter not adequately disclosed begins on the date the beneficiary has actual knowledge of the facts underlying the claim.  Florida Statute § 736.1008(2) provides a way for a trustee to shorten the amount of time the beneficiary has to file a claim from four years to six months. In order for the six month time limitation to apply, the trust disclosure document must adequately disclose the information, and the trustee must inform the beneficiary of the shortened limitations period. The shortened limitations period starts on the date the beneficiary receives both the disclosure document and the limitations notice. .

What Effect Does Divorce or Remarriage Have On Your Estate Plan

Anytime there is a major life change, whether it is the birth of a child, marriage, or divorce, your estate plan should evolve as your life evolves. But do any of these events result in automatic changes to your estate plan, or do you have to update your estate plan after each event?

In most states, including Florida, a divorce may automatically affect the validity of the terms of your will. Fla. Stat. § 732.507(2) provides that any provision of a will that affects a former spouse will be treated as if the former spouse died at the time of the divorce, unless the will or divorce judgment expressly provides otherwise. This means that when your divorce is official, any portion of your will devising any of your assets to your ex-spouse will be deemed void. However, if you want to provide for your ex-spouse in some fashion after the divorce, it is important that your will clearly reflect that intent.

The Hunt for Tom Clancy’s Estate Comes to an End

Popular author Tom Clancy wrote many iconic novels, and the story of his estate battle sounds like it comes straight out of a book. The author, who died at the age of 66 of heart failure, left an estate valued at $82 million. This $82 million estate includes an ownership interest in the Baltimore Orioles baseball team worth $65 million, a working World War II tank, a mansion on Chesapeake Bay and over $10 million in business interests from his novels and movie adaptations.

According to the original will, Clancy left his Chesapeake Bay home and other properties, along with any of his joint bank or investment accounts to his wife Alexandra. Clancy also left a portion of the residue of the estate to the Hopkin’s Wilmer Eye Institute, which he had previously given a $2 million donation in 2005. The rest of his estate was to be divided between a series of trusts. The 2007 will originally provided for three trusts and divided the rest of the estate as follows: one-third for Alexandra, one third for Alexandra to use while she was alive and then passing to their daughter, and one-third to be divided among his four children from his previous marriage.

Estate Planning for Young Professionals: Don’t Wait to Start Planning

Discussing one’s death can be an awkward and uncomfortable experience at any age. It is a topic that most individuals avoid at all costs, especially young adults, as if the mere discussion of one’s future demise will somehow bring it about. While it may not be pleasant dinner conversation, discussions of what will and should happen in the event of death should take place sooner rather than later.

Most young professionals do not feel a sense of urgency when it comes to estate planning, and believe that they have all of the time in the world.  Many young professionals also do not have much of an estate to speak of, maybe some bank accounts, some property if they are lucky, and likely a lot of student debt. Many individuals with few assets do not see the need for any type of estate plan. However, such an outlook is shortsighted and fails to take into account assets that will be acquired in the future. Early estate planning can protect the estate an individual does have, maximize the value and income of both their current and future assets, and also ensure seamless transfer of assets to loved ones in the event of death.

When a Trustee Goes Bad: Removal of a Trustee

Trustees play a critical role in trust administration. Settlors, or creators of the trust, give trustees legal title and management authority over the settlor’s property for the benefit of the beneficiaries.  An unruly trustee could improperly deplete the trust property and leave nothing for the beneficiaries.  Florida recognizes the importance of the trustee’s role and has numerous statutes regulating trustees and protecting beneficiaries.  The provisions include, but are not limited to:

  1. The trustee shall administer the trust in good faith, in accordance with its terms and purposes and the interests of the beneficiaries, and in accordance with the Florida Trust Code. 736.0801, Fla. Stat. (2006).