Placing assets into a trust is a terrific way to both avoid the costs of probate and to protect property from potential misuse by beneficiaries. However, many of those in Miami that come to us here at The Law Offices of Frye & Vazquez, P.L. wanting to set up such trusts fail to realize the extent of the power they are giving to a trustee. If you are a beneficiary to a trust, you may feel as though your interests are completely subject to the will of the trustee. This may leave you believing you have little control over what he or she does with the trust’s assets.
Fortunately, that is not the case. The trustee has duty of loyalty to act only in your best interests (as specified by the trust’s settlor). Often, it may seem as though those interests (which should also be his or her fiduciary interests) are at odds with those of the trustee. If you believe that has been represented in the from a transaction involving trust assets, Section 736.0802(2) of the Florida Trust Code states that you are able to void such an action. Examples of where a trustee’s fiduciary interests may conflict with his or her personal one’s include transactions between his or her:
- Descendants, parents, siblings or their spouses
- Attorney, agent or employee
- Corporations with which he or she may have a vested interest
Only in situations where the terms of a trust authorized such a transaction would it be allowed. The same is true if it was approved by you and other beneficiaries, the settlor (while the trust was still revocable), the court, of if the transaction occurred before the trustee was appointed. You can learn more about managing the powers of a trustee by continuing to explore our site.