One of the essential decisions of the grantor when creating a trust is choosing the trustee, who will manage and administer the assets in a trust fund. The trustee must carry out the grantor’s wishes in good faith. But what exactly do managing and administering a trust’s assets involve?
Specific responsibilities
If a grantor assigns an individual to become the administrator of their trust, they expect them to do the following:
- Follow the terms of the trust document
- Inform the trust’s beneficiaries about its active status
- Identify which assets and properties the trust holds
- Transfer asset ownership to the beneficiaries, such as real property titles and possession of fiscal assets
- Pay the necessary debt, taxes and other valid claims
Depending on the grantor’s directives and involved assets, other tasks may also fall upon the trustee’s scope of duties. It also goes without saying that a trustee must not use the trust’s assets for their personal interest and to the disadvantage of the beneficiaries.
What if the trustee fails to properly do their duties?
Under California laws, the trustee is expected to accomplish the trust’s purpose with reasonable care, skill and caution, as a prudent person would. Administering a trust comes with heavy responsibilities and if the trustee fails to do their duties according to the trust’s directives, the court can hold them liable. If the beneficiaries believe the trustee is not adequately fulfilling their obligations, they might seek legal remedies.
Managing a trust can be challenging and the heavy workload could adversely affect the trustee. This is why it is good to know the scope of responsibilities that will fall upon the trustee.