When there is a dispute regarding the management of the trust, it often begins because the objecting party does not have sufficient information to determine the true value of the trust and/or if trust assets are being depleted. In this situation, it is imperative that you take steps to ensure the trust assets are being safeguarded while the dispute is being resolved.
The most common way to protect trust assets during litigation is to “freeze” them. This means that the court enters an order for injunctive relief, typically on an emergency basis in order to provide protection to the assets as quickly as possible. In order to prove that an injunction order is necessary, it must be shown that there is a likelihood of irreparable harm to the property in the trust and no other adequate remedy at law. Further, you must demonstrate the likelihood of your success on the merits to the court as well as that your interests outweigh any possible damage to the trust.
When trust assets are frozen, they cannot be used or otherwise depleted. In many cases, the court will appoint a fiduciary to supervise and maintain the property in the trust until the dispute has been resolved.
While no two cases are identical, below are a few warning signs that a trust is not being managed properly and you should confer with an attorney:
- Trustee fails to file tax returns for the trust
- Trustee fails to file an annual report on the trust
- Trustee refuses to make financial disclosures, including investments made using trust funds
- You discover a conflict of interest on the part of the trustee
- You discover proof that the Will or its original terms and conditions were tampered with
- The trust has experienced unexplained financial losses
If you believe that a trustee has breached his or her fiduciary duties, contact us for the advice and guidance you need. We can help you determine whether the assets of the trust should be frozen and the best strategy for resolving your concerns.
The Astill Law Office has provided high quality legal services for over 30 years. We specialize in wills, trusts, estate planning, and asset protection. If you have any questions about creating a Trust, Will, or estate planning in general, contact The Astill Law Office at 801-438-8698.