Trusts play an essential role in the estate planning process, providing a way to minimize the friction your heirs and beneficiaries experience when they receive their inheritance. Specifically, trusts can allow your surviving loved ones to avoid the cumbersome probate process, and all the headaches that come with it.
Even with the most meticulously crafted trust, however, there can still be the occasional point of tension. Family members may be caught off guard, their feelings hurt, or their expectations blown, when they find out what assets you left to them.
There are a number of mechanisms available for resolving trust disputes, from basic communication to more elaborate legal procedures. If you’ve experienced a trust dispute, consider some of the options for reaching an amicable resolution, preserving smooth administration and protecting family relationships.
Strategies for Trust Resolution
1) Communication
First and foremost, it’s critical to keep the lines of communication open. In fact, one of the best ways to address a trust dispute is to avoid it altogether, ensuring clear communication between beneficiaries and the trustee before the trust is administered. The trustee can play an essential role here, communicating the terms of the trust with all named parties and working to resolve any underlying disputes before emotions flare.
2) Mediation
If the terms of a trust cause conflict between some of the named parties (or those who aren’t named but feel like they should be), a critical next step is to pursue neutral mediation. An estate planning law firm can help to mediate an open and constructive conversation, ideally leading to a compromise that everyone feels good about. Mediation is well worth pursuing, as it can help everyone to avoid the more expensive and stressful process of litigation.
3) Trustee Intervention
The trustee is charged with doing what’s best for the trust and its beneficiaries, and for upholding the wishes of the grantor. While the trustee does not have unlimited power, they can play an active role in addressing conflicts. Sometimes, mediation from the trustee is all it takes to get all heirs and beneficiaries on the same page.
4) Litigation
Litigation is usually a “last resort” for resolving a trust dispute. Going to court tends to be more expensive, and there is no guarantee of any party getting what they want. What’s more, courtroom litigation is usually the worst option for preserving family relationships. However, in some instances, when other avenues have been exhausted, trust litigation may be the only way forward. If you choose this route, make sure you select an attorney who is experienced in trust litigation.
5) Alternative Dispute Resolution (ADR)
Alternative dispute resolution provides the opportunity to resolve a dispute more efficiently and privately, out of court. The most common methods for ADR include:
- Arbitration, wherein a judge or other arbitrator will hear the dispute outside of court and render a legally binding verdict.
- Collaborative law, wherein each party hires an attorney and they work together, in good faith, to achieve a compromise.
6) Family Meetings
There’s something to be said for a good old-fashioned family meeting. A structured family meeting, with a third-party mediator, can be a great forum for airing frustrations, promoting understanding, and paving the way for consensus.
7) Trust Amendments
It’s also worth noting that, in some cases, a trust can be amended. Changing the terms of the trust may be the best way to address a fluid situation and to avoid any future disputes. Note that not every type of trust can be amended, so you’ll certainly need to consult with an estate planning attorney before pursuing this route.
8) Education
It’s also important to ensure that heirs and beneficiaries are properly educated on their rights under the terms of the trust. The trustee can play an essential role here, as can the estate planning law firm. Ample education at the front end can potentially help mitigate disputes and disagreements down the road.
9) Escalation
No matter the nature of the trust dispute, it’s important to address it with a sense of escalation. In other words, it’s almost never appropriate to jump straight to litigation. It’s always better to start with something informal, like a structured meeting, ongoing dialogue, and/or mediation. The terms of escalation may be discussed during these meetings, but only as a last resort.
Handling Trust Disputes & Trust Litigation
By implementing these proactive strategies, trust beneficiaries can navigate disputes effectively, minimize the need for litigation, and preserve the integrity of the trust. Trust litigation lawyers play a crucial role in guiding beneficiaries through the process, ensuring their rights are protected at every step of the way.
To learn more about trust litigation in the Orange County area, reach out to Max Alavi, APC at OCTrustsLawyer.com. A widely regarded estate planning attorney and elite Super Lawyer, Alavi has a proven track record working in trust mediation and litigation. Find out more by scheduling a consultation today.
Disclaimer
Max Alavi APC, OC Trusts Lawyer, contributed this blog post as an educational resource. The material is meant for informational purposes only and not to provide legal advice because laws and regulations may differ across states, and each case may be unique. If you have any questions about the content of this post, it is recommended that you seek advice from a local Estate and Probate attorney.
