Trust fund for the mentally disabled

UPDATED: Oct 1, 2022

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Trust fund for the mentally disabled

My step-brother has a trust fund that was set up by his deceased mother and deceased grandfather. His uncle is in charge of the Trust fund. Does his uncle have to prove where the money is being spent? He gives my step-brother no money. His wife also told my step brothers Mom before she passed that it needed to be taken out of the uncle’s name because he said my step-brother would never see a dime of the money. The uncle would spend it on his daughters.

Asked on December 7, 2017 under Estate Planning, Georgia


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

Answered 5 years ago | Contributor

The trustee has a fiduciary duty to make the payments to your step-brother, the beneficiary, pursuant to the terms of the Trust.  
The trustee has breached a fiduciary duty and should be sued for conversion (theft in a civil case).  It is NOT necessary for the uncle (trustee) to prove where the money is being spent.
If the Trust includes procedures for removal of the trustee and appointment of a successor, those procedures should be followed.  If the Trust is silent on that issue, the court can remove the trustee and appoint a successor.
A lawsuit should be filed on behalf of your step-brother against the trustee for breach of fiduciary duty and conversion.  The remedy is to seek a constructive trust against the uncle which would require the uncle to return the stolen funds to the Trust.  The constructive trust can be used to trace the stolen funds to any acquisitions and those items or their value are to be returned to the Trust.  In addition, the lawsuit should also seek removal of the uncle as trustee and appointment of a successor trustee.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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