Estate planning is a necessity upon the acquisition of any assets, and one of the most popular tools available is a revocable living trust. With a trust, you can manage your estate during your lifetime and arrange postmortem management as well. Other advantages make living trusts an effective option for passing assets to heirs or other beneficiaries.
However, trusts are not always guaranteed. Sometimes, the trustor’s wishes are not honored, and trust disputes arise in Arizona. Whether you’re looking to set up a trust or are already a relevant party in a trust, it is wise to be aware of the rights and protections offered in the event of a dispute.
Read on to learn more.
The Difference Between Wills and Trusts
The terms “will” and “trust” are often used interchangeably, but the key difference between the two is when the grantor’s instructions take effect. A last will and testament, or will, is used only when the grantor has died. A revocable living trust, however, can be used and changed during the grantor’s life. Additionally, wills typically cover physical items and guardianship of minor heirs, whereas trusts can provide a set income to named beneficiaries.
Grounds for Trust Disputes in Arizona
If there is reason to believe a trust was not created legitimately, you may have grounds to dispute it. These are the common reasons Arizona trust disputes arise.
- Grantor was not of sound mind. Sufficient mental capacity is a requirement for creating a legal trust.
- Grantor was unduly influenced by another party. Trusts must be created without malicious interference.
- Trust documents are invalid. Forged signatures, fraud or incorrect trust information render trust documents invalid.
- Trust documents have ambiguous language. If there are multiple interpretations of the trust, the court may step in to determine the grantor’s wishes.
- Trust administrator violated fiduciary duty. Administrators who mismanage a trust can be held accountable.
To expand on the point above, trustees have the fiduciary duty to follow the instructions of the trust in accordance with the Arizona Trust Code. This duty includes administering the contents of the trust to the beneficiaries, keeping their interests in mind, and remaining impartial throughout the process. Loyalty, reason, efficiency and due care are key. Trustees must also keep financial records and collect trust property while keeping beneficiaries informed until the trust has been administered.
Beneficiary Protections for Arizona Trust Disputes
If beneficiaries feel they are being treated unfairly during the administration of a trust, Arizona law offers some protections and courses of action. The Arizona Trust Code gives beneficiaries the right to, at minimum, an annual accounting record, the contents of the trust, listing of trust assets, disbursement documentation, revenue received and other information. Trustees who are acting unfairly can be taken to probate court, where the beneficiaries and the court can force them to comply with the trust. Alternatively, beneficiaries can file a petition to remove the trustee and have another trustee step in.
Find an Experienced Estate Planning Attorney in Arizona
Here at MacQueen & Gottlieb, we believe there is no time like the present to get your estate plan in order. Our attorneys can guide you and your family through the entire estate planning process and help you avoid Arizona trust disputes. Our firm can also help beneficiaries navigate any trust dispute and keep your best interests in mind. Contact us today at 602-562-7218 to schedule an initial consultation or make an appointment online.