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Living Trust Drastically Changed After Mom Incapacitated/Death

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bdzinla

New member
What is the name of your state? CA

My Mom/Dad's Revocable Living Trust was established in 1992, left everything evenly split among the 3 siblings. The distribution stayed the same for decades.

In September 2012, a first amendment was made mostly dealing with under what conditions Trustors could be ruled incapacitated. This was probably addressed at this time due to their advancing age and my mom's previous Parkinson's diagnosis as well as my dad's extensive heart problems.

In August of 2014, a second amendment was made to add a no contest clause. Although from the look of my moms unusual child-like signature, it's questionable if she understood.

In May 2015, a third amendment was made on the same day Mom was determined to be incapacitated by a doctor (mentioned in amendment). Dad amends the trust to include $200,000 off the top for my sister along with their car (or successor car). The remainder would be divided evenly among the 3 siblings. He stated this was for all her help and sacrifice (she is a nurse who lives close to them) in helping care/coordinate care for them (they had full time professional caretakers paid by them).

NOTE: The mechanism to rule one Trustor incapacitated requires declarations of one doctor and one child of the Trustor (as per 1st amendment Sept 2012). Third amendment mentions the doctor's findings but does not say anything about child of Trustor declaration. Never mind the fact she would be the benefactor of this amendment which may be a conflict.

My Mom passed November 2015. In August 2017, my Dad made a final fourth amendment to the Trust leaving ALL proceeds of the Trust to my sister (estimated $1,200,000 inc house) and making her the Trustee upon his death. He states his reason for this change is for all her hard work and sacrifice for his care (he also had full time professional caretakers 24 hours a day paid by him). This was the exact reason given just 2 years earlier for the $200,000 and the car.

My father passed several weeks ago and we just received a copy of the Trust from our sister's lawyer showing all the later year amendments and the final amendment cutting us out completely. We believe this was a methodical operation by my sister especially since the death of our Mom to get my Dad to do exactly what he did.

She is a master manipulator and would often tell him the only reason he is a live is because of her. he even started repeating it himself. We also understand that she would trash both of us to our father on a daily basis, especially the last few years. She also helped herself to tens of thousands of dollars of vacations by taking cruises (at least 10) with him as his companion the last two years. I'm sure her bank records would show other monetary benefits we don't know about.

Do me and my brother have any recourse or are we simply out of luck?
 


Taxing Matters

Overtaxed Member
Do me and my brother have any recourse or are we simply out of luck?
You'll need to discuss this with a lawyer in the state where your father resided at his death. But a challenge to the amendments will not be easy nor cheap should you have to litigate it against your sister and the estate. It does not sound like your father was legally incompetent when the changes to the trust were made. Assuming he had the power in the trust instrument to make the changes, that would essentially leave trying to make a challenge based on undue influence. It is not illegal for her to try to persuade him to give her everything and doing that does not invalidate the amendments. Undue influence is more than just using persuasion. The California Courts set out a standard in which undue influence is defined as "Consistent with common law, our Supreme Court has described undue influence, in the context of a testamentary disposition of property by will or 'pressure brought to bear directly on the testamentary act, sufficient to overcome the testator's free will, amounting in effect to coercion destroying the testator's free agency.'” Lintz v. Lintz, 222 Cal. App. 4th 1346, 1354, 167 Cal. Rptr. 3d 50, 56 (2014). So the question would be whether she went beyond mere persuasion to something that is effectively coercive such that it overcame his free will, and whether you have evidence to prove it. But you need to have the trust instrument, the amendments, and the circumstances of the relationships between all the siblings and your father all looked at to figure out if there might be a worthwhile challenge.
 
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Dandy Don

Senior Member
This might be considered elderly financial abuse.

Was your mother's mental competency ever tested?

Does the doctor's definition of her being incapacitated in 2015 mean she was mentally incapacitated or just physically because of the Parkinsons?

Who was designated as trustee before your father named the sister as trustee? Was it another family member, or an attorney, or friend of the family?

At some point you and your attorney will need to find out whether sister got mother to grant sister a Power of Attorney, which would have given sister authority to manage and handle all financial assets. Does the trust document include a durable power of attorney or not? If sister did get POA, then you and your attorney will need to look at any transactions that sister did after she received the POA to determine if those changes were legally allowable or not. If she changed beneficiary designations on insurance policies or retirement accounts or 401K accounts, that may be illegal if that is what California state law says. You will want to ask if you have legal grounds to file charges against her for abuse of power of attorney.

Are your mother's bank accounts (checking and/or savings) titled as a trust asset or did sister have her name added as a joint account co-owner so that the money automatically goes to her when your mother's death occurred? Just something else your attorney will want to find out.

Did you and your other sibling know that the 2012 and 2014 amendments were being made at the time they were made or did you only find out about these after your father died?

See if the trust document requires that a trustee's bond be posted or is that requirement exempted?
 
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