You have been named successor trustee. What do you do first?

The first 60 days, in order

• Get the death certificate. Order ten certified copies.
• Read the trust, all of it. Including amendments. You are bound by the document, not by what anyone remembers being promised.
• Serve the section 16061.7 notice. On every beneficiary and every heir at law, within 60 days. It has required contents, including a statement of the 120 day contest deadline and the right to request a copy of the trust.
• Do not distribute anything. Not even small items, not even to yourself, not even where everyone agrees. Distribution before debts and taxes are handled can leave you personally liable.
• Secure and inventory the assets. Change locks if needed, keep insurance in force, and get date of death values.
• Open a trust bank account using a new tax identification number for the trust. Never use your own account.

The duties you have taken on

A trustee is a fiduciary, which is the highest duty the law recognises. You owe the beneficiaries loyalty, impartiality between them, a duty to keep them reasonably informed and to account, a duty not to delegate what you must decide yourself, and a duty to keep trust property strictly separate from your own.

You are personally liable for a breach. Not the trust, you. That is why trustees who are also grieving family members are wise to get help rather than improvise.

What it costs to have counsel

This firm charges 1.25 percent of the value of the trust estate for trust administration, or 1 percent for members of our Generational Wealth Protection programme. The fee is payable from the trust estate, not from you personally, and it is split 80 percent to commence and 20 percent on completion before final distribution.

On a $2,000,000 trust that is $25,000, against a probate on the same estate that would have cost the family roughly $66,000 across both statutory fees. The trust already did its job. Administering it correctly is what preserves the saving.

The mistakes that cost the most

• Missing the 60 day notice. It leaves the contest window open and hands a disgruntled relative a lever.
• Distributing early. Especially to yourself. If a creditor or tax bill appears afterwards, you make up the difference.
• Treating one beneficiary better than another, even with good intentions. Impartiality is a legal duty, not a courtesy.
• Failing to keep records. You will have to account. Reconstructing two years of transactions from memory is not possible.
• Letting the house sit uninsured or unoccupied without telling the insurer, which commonly voids the policy.

Common questions