Removing Sister as Administrator of my Special Needs Trust?

[FordellCastle]

What is the name of your state (only U.S. law)? Illinois
My mother passed away on January 2, 2014. My sister is executor of her will, and is also the trustee of my special needs trust. She was also POA for my Mom. Her personal finances and those of her children are in terrible shape. She took out a $25,000 loan against my Mom's paid off house because she was so broke. She called and renewed a credit card pretending to be my Mom (I was there at the time, and told her it was a crime) because her son could not pay his bills. She sent the credit card directly to him. He lives in Texas. He maxed it out in short order. She is named as owner of a gutter business because her husband could not draw unemployment if he were the owner. Total loans for the company amount to $250,000 to 3 different lenders. Only one is a bank. They have since had to borrow thousands from his brother (one of the lenders) because they could not repay loans (Brother-in-law is an alcoholic). How can I remove her so she cannot borrow from/bankrupt my trust? I have told her it will be complicated, and she can tell the court she is unable/does not want to be trustee. My daughter was underage at the time of trust origination. She and her husband are very financially stable, and make very sound investments. They neither want or need funds from the trust. I do not want my sister involved, as I fear she will lose the money in the trust. I need ongoing care as my health is deteriorating. I love my sister, but want my daughter to handle my finances.

 

[tranquility]

What is the name of your state (only U.S. law)? Illinois
My mother passed away on January 2, 2014. My sister is executor of her will, and is also the trustee of my special needs trust. She was also POA for my Mom. Her personal finances and those of her children are in terrible shape. She took out a $25,000 loan against my Mom's paid off house because she was so broke. She called and renewed a credit card pretending to be my Mom (I was there at the time, and told her it was a crime) because her son could not pay his bills. She sent the credit card directly to him. He lives in Texas. He maxed it out in short order. She is named as owner of a gutter business because her husband could not draw unemployment if he were the owner. Total loans for the company amount to $250,000 to 3 different lenders. Only one is a bank. They have since had to borrow thousands from his brother (one of the lenders) because they could not repay loans (Brother-in-law is an alcoholic). How can I remove her so she cannot borrow from/bankrupt my trust? I have told her it will be complicated, and she can tell the court she is unable/does not want to be trustee. My daughter was underage at the time of trust origination. She and her husband are very financially stable, and make very sound investments. They neither want or need funds from the trust. I do not want my sister involved, as I fear she will lose the money in the trust. I need ongoing care as my health is deteriorating. I love my sister, but want my daughter to handle my finances.

You have alleged nothing that is a breach of her fiduciary duties to you. You have no cause to remove her.

 

[LdiJ]

You have alleged nothing that is a breach of her fiduciary duties to you. You have no cause to remove her.

That depends on whether or not the house is part of the trust...because she DID take a loan out on the house.

 

[tranquility]

That depends on whether or not the house is part of the trust...because she DID take a loan out on the house.

If the house was not "mom's" and was part of the trust at the time of the loan, I agree.

 

[TrustUser]

if the sister is willing, what is the complication ?

hi tq,

not saying that you are incorrect, but that seems like a short-sighted legality, to me.

someone is trying to prevent a situation, where there is clear evidence that possible problems are at least somewhat likely.

a trustee is required to be an honest financial person. just cuz sister hasnt robbed from op yet, she has demonstrated that she is not worthy of being a trustee.

when push comes to shove, there seems to be little doubt that sister would take, if necessary.

 

[TrustUser]

if the sister has even the slightest bit of integrity, she would give up her position as trustee without another word being said.

 

[tranquility]

if the sister is willing, what is the complication ?

hi tq,

not saying that you are incorrect, but that seems like a short-sighted legality, to me.

someone is trying to prevent a situation, where there is clear evidence that possible problems are at least somewhat likely.

a trustee is required to be an honest financial person. just cuz sister hasnt robbed from op yet, she has demonstrated that she is not worthy of being a trustee.

when push comes to shove, there seems to be little doubt that sister would take, if necessary.

The court has no power to change the trust, including the trustee, unless the trustee has committed a fiduciary breach or is otherwise unable to legally continue as trustee. That's the point of trusts. A way to put it to the King.

A trustee is not required to be an honest person. He should be, but there is no requirement in the law. That's why a grantor should carefully consider who they appoint and why the theory of trust protectors have come up.

Of course, if the sister is willing, no problem. Trustees can resign. The title to the thread seems to indicate the OP wants to "remove" her.

 

[FordellCastle]

MY sister has offered to decline being the trustee if I agree that she does not have to repay the $20,000.00 loan she now holds for Mom's house. It would come off the estate instead. She is broke. She wants to buy my Mom's house for little of nothing, with me getting contents only. She has hired a lawyer to file the will, and says she will call him at least once a week @ $275 per hour. She will hire the most expensive auctioneer and set the price of the house so high no one will buy it. This will cost a fortune in property taxes, maintenance, and utilities alone. I taped it all on a voice recorder. Made me ill. Mom would be so ashamed. She wants me to have nothing.

 

[FordellCastle]

if the sister has even the slightest bit of integrity, she would give up her position as trustee without another word being said.

She does not have even a smidgen of integrity. She wants to inflict as much hardship on me as possible.

 

[TrustUser]

how much is in your special needs trust ?

i know if i was in your place, i would be very angry, and want to lash out.

but being that i am not affected, i can perhaps be a bit more rational !!

your sister seems to have the upper hand in dealing with you. such that i think it might be in your best effort to get her the hell out of your needs trust, even if it means sacrificing what is left.

of course that all depends to some degree on how much is in your trust, and how much you are entitled to from the rest of the estate, and what probability you have of ever seeing anything from the estate. i dont have much confidence that you are gonna see anything, anyways.

but make sure you get the proper forms filled out and signed, etc. - showing her being removed as trustee before you give her anything else that she wants.

 

[FordellCastle]

Trust contains just the house I live in at present. I was to get half the estate, valued at about $150K. She will bankrupt the estate rather than give me a dime. She is angry because she thinks I got more attention and help from Mom and Dad. I was diagnosed at 13, and have been totally disabled for years. I don't want to spend money on a lawyer if there is no chance I can remove her. My income is very limited. My body is in poor shape, but mind still works very well.

 

[TrustUser]

nobody has mentioned anything yet about probate for the will ?

it is my understanding that an executor for a will still needs to be approved by the court system, as part of the process of probate.

it does not sound like this has happened yet ? all i am seeing is your sister is taking charge of everything and then blackmailing you.

it would seem to be in your best interest to do 1) get a probate opened up. 2) bring as much documentation as possible to show why your sister should not even be executor of your mom's estate, much less the trustee of your trust.

i suspect that your sister is taking advantage of you because she thinks you dont know enough to do anything about it.

simply stating this to her might make her back way off. imo, she has already acted illegally with regards to finances. and i was in her shoes, the last thing i would want is to go to court and have everyone else know about it.

you may just find that not only does your daughter become your trustee, but she may be appointed as executor - if your sister knows that her other option is being exposed for the fraud that she is.

 

[FordellCastle]

Making copies of all the replies thus far. A lot of good advice. I just want her to be fair, as her 2 children and my 2 are beneficiaries of my trust. She wants them to give up their share to pay her debt against my Mom's house. I asked what they get in return: "They help me". My daughter has agreed to be my durable power of attorney. My health is declining, and I may not be able to act in my own interests for much longer. Both my daughters are wonderful, and I trust them with my life. My sister, not so much.