It can seem as if trust fund beneficiaries lead charmed lives. But some beneficiaries become unhappy with overly restrictive terms of a trust.
One question that Texans often have is whether the trust beneficiaries can dispute the terms of a trust. The answer is yes. More information is available below.
What beneficiaries need to know
Not just anyone can challenge a trust’s terms or dispute its trustee or administrator. To do so here in Texas requires something legally referred to as “standing.” That means that you have to be named in the trust or have a financial interest in the assets of the decedent’s estate.
Standing also requires that you receive less from the trust than you otherwise would if the probate court voids the trust.
Challenging trusts depend on valid grounds
To launch a successful trust challenge, you must allege and prove that the trust administrator or its funder acted unethically or unlawfully.
To establish valid grounds, you must demonstrate one or more of the following valid grounds:
- Incompetence – If the trust creator suffered from dementia or was diagnosed with an advanced case of Alzheimer’s Disease, they were possibly incompetent and lacked the capacity to draft and fund the trust.
- Discrepancies in accounting – This could show up as mismanagement of the trust’s principal, overbilling for administrative services, asset misdistributions or simply incorrect accounting.
- Undue influence – Did a friend or relative manipulate or force the trust grantor into designating them as beneficiary? If so, they may have exerted undue influence to reap financial benefits.
- Documents are defective – Trusts can be invalidated if the trust was created using the wrong documents or was not witnessed correctly.
Fraud – Some fraudsters forge signatures to create a trust from which they then derive benefits.
What is your next move?
Successfully challenging a trust is easier with the services of a well-trained estate litigator. Find someone knowledgeable, trustworthy and eager to help you solve your estate administration problems.