If my husband is 1 of 2 executors of his mom’s Trust, does he have the legal right to see how her funds are being used by the other executor?

His brother is the other executor and is living with the mom. We feel that he is misusing her funds. Can he hold his brother accountable for violating their mom’s best interests?

Asked on September 1, 2014 under Estate Planning, Idaho

Answers:

S.L,. Member, California Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

Both your husband and his brother as co-trustees of their mother's trust are fiduciaries which means they owe a duty to act in good faith.

If the brother is misusing funds, he has committed a breach of his duty as a trustee.  If your husband becomes aware of his brother's misuse of funds and does nothing, your husband is liable for his failure to act and the loss of funds to the trust.

Your husband can demand an accounting.  If the trust provisions provide for removal of a trustee, those procedures should be followed for removal of the brother as trustee if he has misappropriated funds.

If the trust is silent as to the procedure for removal of the trustee,  a petition for removal of the brother as trustee can be filed with the court.  The petition filed with the court should seek the removal of the brother as trustee and also the remedy of a constructive trust.  A constructive trust means that the brother will be required to return misappropriated funds to the trust.  A constructive trust remedy includes tracing the misappropriated funds to any purchases the brother has made in order for the trust to be able to recover those items or their value.


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