While we were married, my then-spouse and I were trustees for an inheritance ($20K) given to our daughter, a minor. When we divorced, he took half of it ($10k), saying he wanted to "keep it safe" until she became an adult. She's now 24 yrs old and it's never been returned. Is she out of luck? We don't know where he is, but we do know where his mother is and know she probably knows where he is.
Estate Planning Attorney
I’m sorry to hear about your difficult situation. If your daughter’s inheritance was placed in a valid trust, then there are specific rules governing the actions of the trustees. While laws directing the formation of trusts and the powers typically available to trustees are often state specific, a trustee is bound by the trust document itself and the terms set forth in it. A trustee has a general duty to protect trust assets for the trust beneficiaries, in this case your daughter. A trust creates a fiduciary relationship between the trustee and beneficiaries, so that the trustee is required by law to act in the best interests of the beneficiaries with regard to the trust assets. The law also imposes on trustees a duty to account for any benefits the trustee may have gained directly or indirectly from a trust. Typically, a trustee cannot personally benefit from a trust unless expressly permitted by the terms of the trust document.
In sum, if your case involves a valid trust document then your ex-husband, as trustee, would have to have managed the trust assets, in accord with the terms of the trust document, for the benefit of your daughter. If he has failed to do so he may be found personally liable for any loss of trust funds. You should review the terms of the trust in question with an estate planning attorney to determine exactly what powers the trustees had in your case and whether these powers were abused.
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