If Your Family Doesn't Agree

If the beneficiaries of your trust do not agree with what the trustee is doing, they may file a lawsuit. The beneficiaries will file papers with the court explaining to the judge why the trustee is making, or is about to make, a bad decision about your trust property. Lawsuits are expensive. The beneficiary who is dissatisfied will need to hire a lawyer, the trustee will need to hire a lawyer, and often the other beneficiaries who will be affected will need to hire a lawyer. At $250 to $300 per hour, if three lawyers are involved, it could cost $750 to $900 or more per hour to resolve the dispute!

There are two solutions: You can either be very specific in your trust document about what each beneficiary will receive (though this may not be practical if your trust is going to remain in place for a long time) or you can put a provision in your trust document that says if the beneficiaries disagree about how the trust property is going to be divided and distributed, the trustee is to sell the property and divide the proceeds. This instruction gives the trustee, rather than the local courts, the authority to solve the dispute.

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