Challenging the Accounting

[jaggerbabe]

What is the name of your state? CA

Hey All -

I am a beneficiary of a Living Trust. Trustor (Dad) died two years ago.

Dad left me a house, valued at 300K, no mortgage, rental property. Left sister / Successor Trustee 100K POD account and his house, valued at 400K. She has transferred title of this house to herself, but has not transferred mine to me. Has been collecting rent (from my house) and using that income to pay off final expenses of Trust.

Finally received accounting last week (I had to retain legal counsel just to get her to communicate with me - which has her extremely upset with me, unfortunatly) Accounting claims 70K in final expenses ($40,000.00 in legal fees and $20,000.00 for Successor Trustee fees!) Both properties were paid off, no mortgages, no investments, no nothing outside of these two properties - a very cut and dry Trust which I thought, and she led me to believe - could have been finalized in six months - and for far less than $70K

Anyway - the tenants in my property vacated last August due to problems with Successor Trustee - now Successor Trustee wants the court to put a lien on my property to pay these lost rents, as well as the expenses mentioned above. And no, I've not seen a penny of these rents - and there is a lot of damage to my property.

Of course, I am objecting to this accounting. My questions are this:

1) Does Successor Trustee have to provide a detailed accounting of expenses? This accounting just says, "Received this much $$$, and paid this much $$$$". No assets, debts, nothing.

2) What happens to Successor Trustee if it is proven that she has totally mismanaged the Trust?

3) Can she be held liable for damages to my property?

4) My property has sat empty for the last 6 months as Successor Trustee refuses to make repairs, try to rent it or release it to me so that I can take care of it, however, she want's the court to put a lien on my house for each month that goes by with no rent?

5) Do I have any recourse in any of this?

Please excuse my ignorance and rambling - I'm just horribly frustrated and confused.


Thanks....

[Dandy Don]

Stop worrying about the accounting right now--that is the least of your concerns. Yes, you are entitled to a more detailed accounting (and you need to request an accounting statement that shows the balance of the trust account, such as a bank account statement) and if you have not already gotten a copy of the trust document you need to request it (have your attorney request it on his letterhead stationery since that is more likely to be regarded as official and not ignored). You can request an audit (it will be paid for by the trust). And you can probably also request that this trustee be bonded so that monies can be recovered if mismangement is found later on. Why aren't you asking your attorney these questions? Make sure your attorney also consults with a real estate or business law attorney to get answers to your questions about the liens--this seems to be a phony strategy by sis and her attorney to raid the trust unjustly.

(1) Are there any cash assets in the trust? What is it worth now, not including the value of the homes?

(2) Does the trust specifically mention your home and/or does it allow for it to be rented out or is there no mention of the home and rent at all?

Your focus right now should be to look at the title/deed for the home to see if the trust's name is on it or not--if it is not, then it was never funded into the trust and that could be a serious omission by your father. If it was not funded into the trust then it may be handled by probate law and you need to find out whether this man had a will that mentions who gets the home or if there is no will and if it will be divided up according to intestate probate law.

DANDY DON IN OKLAHOMA (tiekh@yahoo.com)

[jaggerbabe]

Yes, you are entitled to a more detailed accounting (and you need to request an accounting statement that shows the balance of the trust account, such as a bank account statement) My attorney has asked for a "proper" accounting and has already filed objections to the accounting we already recieved.

If you have not already gotten a copy of the trust document you need to request it (have your attorney request it on his letterhead stationery since that is more likely to be regarded as official and not ignored). [I]I do have a copy, and it says this property is to go to me".

(1) Are there any cash assets in the trust? What is it worth now, not including the value of the homes?
The only cash assets I am aware of are the rental monies. Outside of the Totten Trust accounts Dad set up for Successor Trustee (her lawyer sent copies of the statements to me and my lawyer already contacted the bank, which confirmed it)- I'm not aware of any other bank accounts, life insurance policies - Trustee has not spoken to me since Dad died.

(2) Does the trust specifically mention your home and/or does it allow for it to be rented out or is there no mention of the home and rent at all? It specifically mentions that this house is to go to me, and it also says that Dad has no intention of holding on to any property after his death".

Your focus right now should be to look at the title/deed for the home to see if the trust's name is on it or not--if it is not, then it was never funded into the trust and that could be a serious omission by your father. I did see the titles, and both properties were titled to the Trust.

I believe Trustee is looking for a way to take this house from me, or keep it in the Trust indefinitly so she can collect rents for herself (It was renting for 1000 / month). She knows that I don't have a lot of money and it's hard for me to keep up with legal fees, taking time off work and going to court. She only has money because Dad gave it to her and I feel like her and her "lawyer" are trying to intimidate me with threats of liens.

Thanks for your advice, DD -

[Dandy Don]

This is why you need to be consulting your own attorney. They won't be able to take your ownership of the house away with liens, but what the liens do is obligate you to pay them off before you get full ownership of the home, so you need your attorney's help to fight this.

DANDY DON IN OKLAHOMA (tiekh@yahoo.com)

[BlondiePB]

jaggerbabe,
In addition to what DD said, when your sister does produce the "proper" accounting and if it arrives without copies of cancelled checks/receipts/itemized fees, have your attorney request your sister to submit them. The look on your sister's face would have been "priceless" to you when she both learned that she has to submit a "proper" accounting and when she looked at all the schedules, etc. with which a proper accounting consists. It's definitely no picnic!