Under what conditions can a Trustee take money out of a Trust?

My husband and I rented a house from my husband’s mother for 2.5 years and we just bought our own house and moved out. My mother-in-law is listing the house we rented to try to sell it. Her realtor recommended that she repaint all the walls white she gave us permission to paint and never told us we had to repaint when we moved out. Her realtor also told her to replace the carpet which is 24 years old – original carpet. My mother-in-law thought it should be our responsibility to pay for all of it when we don’t think it is. My husband’s deceased father left him a Trust that I don’t think he can access until he’s 25 in 2 months. My mother-in-law is threatening to take money out of my husband’s Trust to pay for updating this house. Legal?

Asked on September 2, 2015 under Estate Planning, Minnesota

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

A trustee can only take money from a trust when the terms of the trust authorize her to do so. If the trust instrument does not allow her to take money out of the trust to update the house, then at a minimum, she will have violated her duty as trustee and could be sued for the amount of money she takes, to force her to return or replace it. In some situations, if she demonstrably acts with knowledge that she has no right to to do this, she have even be committing theft and be subject to criminal prosecution.


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