Mother plans to leave son only $1 due to his Marijuana conviction

Dear Len & Rosie,

My mother has a trust. I am her sole successor trustee. I have two brothers and a sister. My mother is leaving my younger brother only $1, because he was once convicted of marijuana possession and he never calls or visits. She thinks he is still a dope smoking pothead. What would have been his share is to be divided up among my cousins and the church. As the trustee after my mother dies, am I able to ignore her wishes and give my brother his fair share of my mother’s property? How difficult is it to change it the way I see fit? This is really bothering me because it’s just not fair. I feel all of her children should be treated alike.

Suzanne

Dear Suzanne,

Your plan won’t work unless nobody cares what you do as trustee, which is hardly ever the case. You’re job is to marshal your mother’s assets and divide and distribute them to the beneficiaries named in the trust after paying off your mother’s debts and taxes.

The reason it won’t work is that you are obligated to provide a notice to all of the trust beneficiaries under California Probate Code section 16061.7 within sixty day of your mother’s death. This notice spells out that each recipient is entitled to a copy of the declaration of trust. You can’t hide it, because your brothers and sister aren’t going to take it lightly if you claim they don’t need a copy. One of them, at least, will see a lawyer who will notify them of their rights.

The rule to remember is simple. You can give away your money, but giving away other people’s money without their consent is something for which you may be held personally responsible. When you become trustee, you will take on a fiduciary duty to each of the beneficiaries, including your cousins and the church. If you ignore the terms of the trust and divide everything in the manner you believe to be fair, you will commit a breach of that duty.

If your cousins and the church ever find out about it, and they will, they can sue you. If they do, they will definitely win. That means your share of the trust will wind up going to your cousins and the church instead of your brother’s share.

You should also think about your mother’s wishes. She may be entirely justified in leaving your brother nothing. Maybe your mother wouldn’t mind so much that your brother smokes marijuana if he bothered to keep in touch with her. If he isn’t acting like a member of the family then why should your mother treat him like one?

Remember, it’s your mother’s money, not yours. The only valid definition of what’s right and what’s fair is the one in your mother’s heart. As long as she can make her own decisions, your mother can leave her property to whomever she sees fit. If you want to change this, try to reconcile your mother with her prodigal son.

Len & Rosie

Duties and responsibilities of a trustee

Dear Len & Rosie,

Property was left to my brother and sister and me from our mother in a trust. My mother had signed a trust amendment stating that I should receive an additional $15,000 off of the top for taking care of her. My brother, the trustee, says that he and my sister won’t agree to it, and he’ll leave all of the money in the trust until we all agree. Can he do this? My mother’s home has been sold. The title company says, by law, that since the house was sold, my brother must pay the attorney fees and then divide the rest of the trust amongst the three of us. Can he hold on to the money legally?

Shauna

Dear Shauna,

We hope you are not looking to a title company for legal advice. They do a very good job at what they do, insuring that a home buyer is actually getting what he or she is paying for, but title companies really don’t know anything about trust law except as to how it applies to deeds and title insurance.

One of the great advantages of trusts is that since trusts avoid probate, cooperative families have the opportunity to cut a few corners. As long as the taxes and creditors get paid, the trustee and beneficiaries of a trust can more or less agree to wrap up the trust in a quick and dirty manner, because the trust beneficiaries are the only persons that have any rights with respect to a trust, other than creditors, the IRS, and the California Franchise Tax Board.

Even when beneficiaries don’t get along so well, trusts are usually cheaper and easier to deal with than wills in probate, but trustees have to careful to follow all of the rules. Your brother was supposed to provide you, your sister, any other trust beneficiaries, and certain other persons notice under California Probate Code section 16061.7 within ninety days of your mother’s death. This notice triggers a 120 day countdown on their right to challenge the validity of the trust amendment. If that notice was provided, and if the 120 days are up, then the $15,000 gift is yours legally and your brother and sister may whine about it all they want but they can’t do anything about it. Except stall.

Being a trustee is like standing behind the counter at a bank. It’s not so much a position of power as it is a position of responsibility. If the trust says you get another $15,000, then the trustee has to honor your mother’s wishes and give you the money. If he doesn’t, you could sue him for breaching the fiduciary duty he owes you as a trust beneficiary. You’ll win, assuming your mother didn’t lack capacity when she signed the trust amendment, but you can give up on the idea of cutting corners. Trust administration will be more expensive for everyone.

This puts you in the difficult position of deciding whether or not it’s worth it to take your brother to court. It’s only $15,000 and you would have inherited $5,000 of it anyway. That means you’re arguing over $10,000. While you certainly deserve what your mother intended you to receive, remember that it’s only money, and giving it up may help preserve peace in your family. It’s up to you to decide whether that peace is worth $10,000.

Len & Rosie