Chicago Lawyers for Breach of Fiduciary Duty by a Decedent’s Trustee
If you suspect the trustee of your deceased family member’s trust breached their fiduciary duty, do not hesitate to contact Peck Ritchey, LLC. We might be able to represent you in a lawsuit against them to recover financial losses and hold them liable for their actions.
At Peck Ritchey, LLC, our Chicago breach of fiduciary duty lawyers have more than 100 years of combined legal experience. We know how to handle trust litigation and hold people accountable for their misconduct. You can count on our team to provide the legal guidance, representation, and support you need while you’re working through the process of suing a trustee who has misused their position. We will handle every aspect of your case and try to reach a favorable outcome.
Call Peck Ritchey, LLC for your free consultation today at (855) 328-5787. We’re available 24/7 to speak to you.
What Is “Fiduciary Duty?”
A fiduciary duty is a legal obligation to perform the tasks outlined in an authority-granting document and to act in the best interest of another party. When it comes to an estate plan, the appointed trustee must ensure they carry out the decedent’s final wishes. That means collecting and valuing the assets held in trust, paying expenses, and distributing the assets to the named beneficiaries.
Unfortunately, a person in a position of power might fail to carry out their responsibilities. A breach of fiduciary duty occurs when the trustee does not meet their obligations according to state law or the trust agreement. As a beneficiary of the trust, it is your right to pursue legal action against the trustee. You can file a lawsuit in probate court and seek compensation for stolen property, misappropriated assets, and other fraudulent activity.
Fiduciary Duties of a Trustee
A grantor is a person who establishes a trust and creates the legal agreement that outlines their wishes and provides instructions on handling the account. Typically, grantors include the names of beneficiaries they want to receive the property held in trust when they die.
The appointed trustee is responsible for a range of duties. They must manage and control all assets the grantor places in trust. That means administering the trust according to the grantor’s instructions in the agreement.
Illinois law imposes various responsibilities and duties for the trustee of a trust, including:
- Act loyally and uphold a duty of care
- Act in the grantor’s and beneficiary’s best interests
- Avoid actions that personally benefit the trustee themselves or favor one beneficiary over another
- Avoid conflicts of interest
- Invest assets to maintain or increase their value by getting appraisals done, opening brokerage accounts, or seeking investment advice
- Distribute all assets to the named beneficiaries correctly and timely
Carrying out these duties requires the trustee to understand state laws and to know how to handle the trust without violating their legal obligations. When a breach of fiduciary duty occurs, a beneficiary might not receive the assets left to them or the funds necessary for their financial security.
Common Types of Breach of Fiduciary Duty
A breach of fiduciary duty occurs when a person fails to act in the interests of another as they were directed or intended to do. A trustee can breach their fiduciary duty in numerous ways, such as:
- Misappropriating the estate or trust assets
- Failing to provide the beneficiaries with annual accounting documentation
- Mishandling the property held in trust
- Withholding assets from named beneficiaries
- Transferring or using assets for personal gain
- Delaying the distribution of property
- Failing to disclose relevant information regarding the trust to beneficiaries
- Creating losses due to a wrongful act or omission
- Engaging in fraudulent activity
- Failing to take reasonable steps in keeping control of, taking, or preserving the assets held in trust
- Commingling trust assets with personal assets
- Misrepresenting a statement of fact
If you believe the trustee breached their fiduciary duty, you should immediately reach out to Peck Ritchey, LLC to learn about the available legal options. One of our Chicago trustee breach of fiduciary duty lawyers can review the circumstances of your case and determine what we can do to help you hold them accountable.
Pursuing Legal Action for Breach of Fiduciary Duty
If you are the beneficiary of the trust and believe the trustee breached their fiduciary duty, you could file a lawsuit against them. You must file your case in probate court. Peck Ritchey, LLC can draft the necessary legal documents and file them on your behalf.
If the court finds the trustee guilty of breach of fiduciary duty, they can impose various penalties based on the type of breach and other contributing factors. Common legal remedies are listed below.
The court might order the trustee to pay a surcharge. Surcharges are typically meant to compensate for losses or costs suffered by the estate, beneficiary, or trust account, such as:
- Profits the trustee made from breaching their fiduciary duty
- Depreciation in or loss of value of the assets
- Profits the beneficiary could have made if there wasn’t a breach
Fiduciaries might receive a flat fee or percentage of the profits for assuming a fiduciary responsibility and managing the assets held in trust. The court could order that the trustee cannot receive their fees up to a specific amount or over a certain period if it discovers a breach occurred. Additionally, the trustee is not permitted to use funds in the trust account to pay for legal costs and attorney’s fees.
Removing the Trustee
State law allows the probate court to remove a trustee for a breach of fiduciary duty. Without specific guidelines, the removal of a trustee is up to the court’s discretion. Typically, malfeasance is the deciding factor in determining whether a trustee should continue to manage a trust.
For example, evidence of wrongful conduct or theft can result in removing a trustee. However, mismanaging the account could also be sufficient to have the trustee removed.
Punitive damages are a type of compensation that punishes the defendant for their wrongdoing. The court might bestow this award on a beneficiary if it determines there was a breach of fiduciary duty.
There must be clear and convincing evidence of the trustee’s wantonness, gross negligence, malice, fraud, willfulness, oppression, or another action that demonstrates a disregard for the beneficiary’s rights.
Peck Ritchey, LLC has a proven track record of success in trust litigation. Our Chicago trustee breach of fiduciary duty lawyers have received recognition for our work from various organizations, such as Super Lawyers and U.S. News Best Law Firms. We also hold the highest possible rating from Martindale-Hubbell.
If you are a beneficiary of a trust and believe the trustee has breached their fiduciary duty, call Peck Ritchey, LLC at (855) 328-5787 right now for your free consultation.