Being a trustee means that you have legal title and control of property, but it also means that you have many duties to uphold. Trustees must put their own interests aside and act solely in the interests of the beneficiaries. Unless the trust instrument says otherwise, trustees must:
- Treat each beneficiary and class of beneficiaries impartially -- trustees can't favor the beneficiary now receiving distributions over the people who will get the trust property when the trust terminates.
- Meet their obligations to account to beneficiaries and to keep beneficiaries informed about key events.
- Manage the trust assets as required by the Texas Uniform Prudent Investor Act, which requires diversification and active management of trust assets in accordance with the modern portfolio theory.
- Account for the money received and the money paid out under special rules applicable to trusts.
- Act in good faith toward beneficiaries and treat them fairly.
Changes to the law in the past 10 years have made it much more difficult to meet one's obligations as trustee. Trustees can't just hold onto property without considering reinvesting the property in appropriate investments. These new rules come as a shock to many of our clients who are trustees.
The lawyers at The Karisch Law Firm, PLLC, can help you understand your responsibilities and take appropriate action. Glenn Karisch chaired the subcommittee of the Real Estate, Probate and Trust Law Section of the State Bar of Texas that was responsible for writing the Texas Uniform Prudent Investor Act and the Texas Uniform Principal and Income Act in 1999 - 2002, then he worked to pass that legislation in 2003 as chair of REPTL's probate legislation committee. He is an expert on "the two UPIAs" and wrote The UPIA Handbook in 2003.
Contact The Karisch Law Firm, PLLC, if you would like to talk to us about representing you as trustee.