In a family trust, the Probate Judge is requiring the trustee to have a bond. What is the purpose of requiring a bond? Does the court usually require the bond to cover the value of trust assets?
Normally, the court does not have jurisdiction over the administration of a trust. Because it DOES in your case, I am assuming that something has happened to cause the court to assert jurisdiction. The trust may be contested or there may be some other reason to suspect that assets may be at risk. As Attorney Stumpf indicated, the bond is an insurance policy that pays off if the trustee absconds with the trust funds or otherwise causes them to be lost. Most of the time, in my opinion, the bond is pure profit for the insurance company and a waste of money. Of course, in the cases where the money would otherwise be lost, the beneficiaries are tremendously thankful that there was a bond.
Because the judge is in the best position to review YOUR situation, and is in possession of facts and information that are not included in your summary, I would not presume to second-guess that. The judge may not know best, but you are not going to persuade him/her otherwise.
*** LEGAL DISCLAIMER I am licensed to practice law in the State of Michigan and have offices in Wayne and Ingham Counties. My practice is focused in the areas of estate planning and probate administration. I am ethically required to state that the above answer does not create an attorney/client relationship. These responses should be considered general legal education and are intended to provide general information about the question asked. Frequently, the question does not include important facts that, if known, could significantly change the answer. Information provided on this site should not be used as a substitute for competent legal advice from a licensed attorney that practices in your state. The law changes frequently and varies from state to state. If I refer to your state's laws, you should not rely on what I say; I just did a quick Internet search and found something that looked relevant that I hoped you would find helpful. You should verify and confirm any information provided with an attorney licensed in your state.
1 lawyer agrees
Estate Planning Attorney
The purpose of the bond is to protect the value of the estate. When a person is appointed personal represetative/fiduciary, they get control of the assets and have the ability to cash it all in and escape to Bora Bora (not legal of course, but they CAN do it). The bond puts them on the hook in case they do do that. Sometimes even when the trust or will specifically waive bond, the Judge may still order that a bond be in place.