October 28th, 2022 in Trusts
Is going to court really necessary? I don’t want to go. For Melissa, it has been three years since her mother passed away. Her mother’s trust left everything equally between her two daughters: Melissa and Sarah. The main asset of the trust is a house in San Jose, California. Just prior to their mother passing away, Sarah moved into the house to help her mother. Melissa was grateful Sarah was able to live with their mother and help her during her final days. Now, three years later Sarah has remained in the house, is unwilling to move out and refuses to either sell the house or buy out Melissa’s interest in the house. Sarah was named as the trustee of their mother’s trust and has refused to sale the home so the proceeds can be split equally between Melissa and Sarah. This has caused a deep rift in their relationship. Melissa wants to receive her share of the trust as her mother intended and Sarah is refusing to let this happen.
Melissa was near tears as she sat in the office explaining the situation to me. Real property in the Silicon Valley, including San Jose, is expensive. With her share of the trust proceeds, Melissa was planning on purchasing a home of her own. Melissa wants to understand her rights as a beneficiary but also does not want cause any further problems with Sarah. Melissa asks if there is a way this can be fixed without going to court.
Many of the clients I meet with want to have the court enforce the terms of the trust and receive their distribution but do not want to go to court. They want to go to the judge, explain the situation and have the judge call the trustee and tell the trustee to do their job properly. Other times the client wants to request the court investigate and tell the trustee what to do without the client getting involved. However, this is not the court’s role.
Any beneficiary can request court oversight of a trust. This cannot be done through a letter to the judge but needs to be done in a way in the manner which is prescribed in the California Code of Civil Procedure, California Probate Code, California Rules of Court and the local court’s rules. In Santa Clara County, this is the local rules of the Santa Clara County Superior Court. There is a procedure and process when you are requesting the court intervene. A petition must be filed, the petition must be served on the parties to the action and you must follow the procedures set in place for the type of relief you are requesting the court grant.
Many times, like Melissa, the choices are to either enforce your rights as a beneficiary or do nothing. It is likely Sarah’s behavior will continue especially since she has made the distributions in three years and continues to use the trust assets for her own benefit.
Many people believe a letter from an attorney will persuade the trustee to do their job correctly and distribute the assets to the beneficiaries. The client wants a magic wand waved that will fix the problem with just a letter being sent to the trustee. In my experience of having done this many times the times that the trustee is responsive to a letter are few and far between. It is an unrealistic expectation that once the trustee receives a letter, the trustee will straighten up and executes his duties properly. Most times the trustee simply ignores the attorney letter. My office will generally recommend to send one letter to see if that is all it takes. Sadly, most times further action is required. After one letter we generally recommend filing a petition with the Probate Court to seek court intervention and oversight and to force a distribution pursuant to the terms of the trust. There are many remedies available to the beneficiaries through the court system but it takes time and effort to secure that help.