My grandfather has advanced Alzheimer and has been ruled by a team of doctors incapable of making decisions and being not of sound mind.
My uncle and aunt are co-trustees of his living trust and also his mother's trust. He is sole beneficiary of both trust. His trust is revocable and his mother's trust is irrevocable.
The two trusts together own a lot of income producing real estate. We got wind of some shady dealings and asked for an accounting. My uncle's lawyer sent a letter stating the remainder beneficiaries are not entitled to an accounting, since the sole beneficiary is still alive.
Is this correct? Or does the fact that my grandfather now incapacitated give us rights to financials? Specifically we want to see financial statements for the LLC that holds the real estate.
Also, does the trustee have a fiduciary duty to the remainders or just to the beneficiary?
I don't know if CA is a Uniform Trust Code state but the basic theory behind beneficiaries requesting the trust document is it allows them to protect their interest. Meaning if the trustee is doing something that harms the future beneficiaries, they have a right to protect themselves. I would say the remainder beneficiaries are entitled to the trust document. Does your grandfather have a power of attorney appointed other than your uncle and aunt? If so, have the POA request the accounting on behalf of your grandfather.
Yes. When trust beneficiary incapacitated, trustee required to account to remainder beneficiaries. Uncle's lawyer is wrong.
Yes. Trustee owes fiduciary duty to all beneficiaries. This includes current and remainder beneficiaries.
I have successfully represented remainder beneficiaries in securing an accounting from successor trustees.
Possible remedies include, not limited to;
-petition for accounting;
-petition to remove trustee;
Complete review of facts, both trusts, LLC operating agreements needed to opine further.
Your grandfather's incapacity makes the trust irrevocable and should trigger a requirement to account. Even if it does not, you can seek the appointment of a Conservatorship who would have the right to compel an accounting. Seek a probate litigator for more details.
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