Is a trustee entitled to a commission/fee?

[sharonlou]

What is the name of your state (only U.S. law)? NC
Is a trustee entitled to a commision/fee for services? I believe the executor is, although it can be waived. In both cases (executor and trustee), is it public record whether the executor/trustee took the commission/fee and the amount? Also, when is such a fee made available to the executor/trustee (at inception or when it's closed out or other?).

Is there a common way to learn the fundamentals of estate planning? I don't even know what to ask. It would be nice to attend a seminar or something. What are the common means by which people acquire knowledge to plan their estates?

 

[anteater]

North Carolina law provides:

§ 32‑54. Compensation of trustees.
(a) If the terms of the trust do not specify the trustee's compensation, the trustee is entitled to receive from the assets of the trust compensation that is reasonable under the circumstances.

(b) All of the following factors shall be considered in determining reasonableness of compensation:
(1) The degree of difficulty and novelty of the tasks required of the trustee.
(2) The responsibilities and risks involved.
(3) The amount and character of the trust assets.
(4) The skill, experience, expertise, and facilities of the trustee.
(5) The quality of the trustee's performance.
(6) Comparable charges for similar services.
(7) Time devoted to administering the trust.
(8) Time constraints imposed upon the trustee in administering the trust.
(9) Nature and costs of services delegated to others by the trustee.
(10) Where more than one trustee is serving, the reasonableness of the total fees paid to all trustees.
(11) Other factors which the trustee or the clerk of superior court deems to be relevant. (2004‑139, s. 2.)

§ 32‑56. Payment of compensation without court order.
The trustee is authorized to pay the compensation provided for in G.S. 32‑54 without prior approval of the clerk of superior court only if:
(1) The annual amount of compensation does not exceed four‑tenths of one percent (4/10 of 1%) of the principal value of the assets of the trust on the last day of the trust accounting year; or
(2) Notice has been given pursuant to G.S. 32‑55 and no qualified beneficiary or representative of a qualified beneficiary has initiated a proceeding under G.S. 32‑57 for review of the reasonableness of the compensation within 20 days after notice has been given by the trustee in accordance with G.S. 32‑55. (2004‑139, s. 2; 2007‑106, s. 40.)

A will must be probated. And the records of the probate case would be publicly available.

Generally, a trust is a private document unless some interested party brings an issue before the court.

Try your local public library. There is usually quite a collection of books dealing with estate planning. There will also be a goodly amount of information available on the internet.

Be careful about seminars. Know who is sponsoring the seminar. Many are thinly disguised product pitches.

 

[sharonlou]

Thank you. So, in other words, the trustee may currently be drawing out annual compensation?

I am a contingent beneficiary of the trust. The trust calls for an annual accounting. I have never seen one, nor do I have knowledge of the value. I am very concerned about the trustee's lack of responsibility (perhaps negligence or I think the legal term is "waste"). I don't want to start a war, but I want to know what's going on. Asking Qs is perceived as a threat or challenge by the trustee, and great lengths are taken to keep things secret (which fuels my concerns). This is a family trust (meaning no outsiders) which further makes me wonder why the secrets and lack of communication? I had no idea what was in the trust until I went to the county and got a copy of the public record (the trust was established within my mother's will).

Is an annual accounting a rhetorical concept or is it something that actually is expected to occur in trust administration? I am very worried about the trustee's actions (or lack of) and negligence. If it's being mismanaged, this could result in a situation for which there will be no remedy for my father. My potential inheritance is of secondary importance, since my father is the primary beneficiary if he needs financial support, which is imminent. I am only a beneficiary if there is anything left when dad passes away. On the other hand, I really don't want the trustee responsibility myself, as next in line. I have tried all the friendly tactics and diplomacy I can think of, without results.

Any advice?

 

[anteater]

I am not certain what rights a contingent beneficiary has in North Carolina. But, if you want to wade through the North Carolina Uniform Trust Code, here is a link to it:

http://www.ncga.state.nc.us/gascripts/Statutes/StatutesTOC.pl?Chapter=0036C

Article 8 is probably of most interest to you.

 

[sharonlou]

Just for fun, let's assume I am entitled to an accounting (I'm pretty sure I am but anyway...). Are these actually done in practice or just words that are put into these documents which are then typically ignored? I'm trying to decipher what happens in reality.

Thank you for the link!

 

[anteater]

Unless it is a professional trustee, I would say "ignored" more often than not.

It will often take threats, being smacked upside the head with the trust code, and/or being dragged into court....