A story about a trust, a trustee and non-disbursement

Aug 7, 2019

  1. aussieman3000
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    aussieman3000 New Member

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    Hey everyone.

    New to the game so please bear with me. My mother died in March (Dad in 2003) and other than the estate, a life insurance policy was put in place back in the nineties, to be paid to a trust of which my brother is trustee and beneficiary. I have confirmed thru the provider that the claim has been paid out 6 weeks ago. And of course, 2 months ago, my brother referred all correspondence about both the estate and the life insurance to be put through attorneys. I have reason to believe, he is not just stalling but will not pay out the claim. He is also using it as blackmail to go after money from the estate. He has failed on virtually all responsibilities as a trustee to protect beneficiaries and likely feels he is above accountability. The estate is in Oregon and I live in Washington.

    Anyone got any ideas of what to do and options to proceed with? Are there criminal liabilities or just civil and I have to sue him?

    Thanks so much
    Paul
     
  2. somarco
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    somarco GA Medicare Expert

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    Sounds like you are asking a legal question . . . and would like an insurance agent answer.

    You would be better off calling Handel on the Law
    https://www.handelonthelaw.com/
     
    somarco, Aug 7, 2019
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  3. DHK
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    DHK Guru

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    Counsel with an estate planning attorney in your state about this case.

    In my non-legal opinion, you sue for breach of fiduciary duty.

    What Are a Trustee’s Fiduciary Duties? - dummies
     
    DHK, Aug 7, 2019
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  4. fed up
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    fed up Guru

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    You should be able to find what county appointed your brother as executor and send them a letter stating what is going on
     
    fed up, Aug 8, 2019
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  5. Allen Trent
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    Allen Trent Guru

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    You mention your brother is the beneficiary. If you meant he was the only beneficiary on the life policy, it has nothing to do with the estate or a trust.

    The estate will only involve estate assets that had no joint ownership or had no listed beneficiaries on the accounts or had no pay on death clause on the accounts or were not directly owned by the trust. The executor listed in a will will handle that aspect of handling the estate assets & debts for the probate process.

    Any items owned by the trust or directed to the trust by beneficiary designation or pay on death clause will not go through the estate/probate and are handled by the trustee of the trust

    The direct beneficiary of life insurance, retirement accounts or annuities receives proceeds directly & has no responsibility to the beneficiaries of the trust nor to whoever the court decides is the beneficaries of the net probate estate.

    Executor has fiduciary obligation to whoever the court decides are the beneficiaries of the net probate estate.

    Trustee has fiduciary obligation of the trust assets to the trust beneficiaries.

    Consult an estate planning attorney, likely in the city or state your parents resided.

    Good luck & sorry about your loss
     
  6. somarco
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    somarco GA Medicare Expert

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    If I read the OP correctly, the Trust was the bene of the life insurance. The brother is the bene of the Trust.
     
    somarco, Aug 8, 2019
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  7. Allen Trent
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    Allen Trent Guru

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    agree, but OP said that was how it was set up in the 1990s, but the OP also said the brother is the Trustee & beneficiary of the trust. So, as worded, the OP would not be involved in the Life policy as he is neither a listed beneficiary of the life policy nor a beneficiary of the trust. Maybe the OP meant to say the brother is the trustee & OP/brother are beneficiaries of the trust.

    Keep in mind, if the policy was written in the 1990s, very possible the beneficiary form may have been changed
     
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