When a person establishes a trust, they must name a trustee to care for the trust. Trustees have specific duties and must comply with certain standards.
While trust administration usually evolves without any issues, there are times when problems arise. At that point, those who have an interest in the trust may choose to challenge the trustee so the court can step in to determine what, if any, action needs to be taken.
Breach of fiduciary duty
One of the primary reasons to challenge a trustee in Ohio is if there is a breach of fiduciary duty. Trustees are legally obligated to act in the best interest of the trust and its beneficiaries by adhering to the terms outlined in the trust document.
A breach of fiduciary duty could involve mismanagement of trust assets, failure to distribute assets according to the trust terms, self-dealing or making investment decisions that don’t align with the beneficiaries’ best interests.
Lack of transparency or communication
Beneficiaries have the right to be reasonably informed about the trust’s affairs and to receive regular accounting reports from the trustee. If a trustee fails to provide necessary information, communicate effectively or offer transparency regarding the trust management, beneficiaries might have cause to challenge their actions.
Incompetence or incapacity
A trustee must be capable of managing the trust’s affairs effectively. If a trustee is no longer competent or capable of fulfilling their duties due to mental incapacity, physical illness or a lack of necessary skills, beneficiaries may seek to have them removed.
Conflict of interest
A trustee can’t engage in transactions that could benefit them personally at the expense of the trust or its beneficiaries. If a trustee is found to have a conflict of interest that affects their ability to administer the trust impartially, beneficiaries have grounds to challenge the trustee.
Other reasons to challenge a trustee may also be valid. Discussing one’s case with a legal representative who can explain the options available and assist with the matter can benefit beneficiaries who want a trust creator’s wishes to be properly followed.
