Q. As beneficiary of a California Trust Agreement now supporting my mother, am I entitled to an accounting?  I co-signed the original Trust Agreement (“Trust Estate”) as a beneficiary.  I suspect mismanagement of the trust, or worse. The trustees have refused to send me the latest version of the Trust Agreement and the latest accounting of the Trust.

A. If the trust is still revocable, the trustee has no duty to account to you. If the trust has become irrevocable, however, then according to California Probate Code Section 16061:

“…on reasonable request by a beneficiary, the trustee shall provide the beneficiary with a report of information about the assets, liabilities, receipts, and disbursements of the trust, the acts of the trustee, and the particulars relating to the administration of the trust relevant to the beneficiary’s interest, including the terms of the trust.”

This may be modified by the trust document itself, but to avoid an accounting they will have to prove that the trust waives the duty to account.

It sounds as if the trustee will not take you seriously without an attorney on your side. I suggest you contact one to speak on your behalf, and to remind the trustees of the potential they will be held personally liable for breaches of trust.

Good luck!

You should review your estate planning documents periodically. If it is not up to date when you die, your estate may not be distributed as you wish.

Your Trust can be changed through an Amendment, a legal document that must be drafted and executed with the same procedure that applies to Trusts. Do not change your documents by writing on them or by crossing out words or sentences.

You should review your plan when:

• You get married or divorced
• There are major changes in your family (births or deaths)
• Your children come of age
• You receive a windfall or significant loss of assets
• You no longer find your choice of guardian or executor appropriate
• It has been 3 years since your last review

In California, both the personal representative (an executor or administrator) and the personal representative’s attorney are entitled to compensation.  If the Will specifies the compensation, then that’s all they can receive (P.C. 10812).  If the Will doesn’t specify, then the personal representative and the attorney are each entitled to fees for ordinary services (P.C. 10810) and fees for extraordinary services (P.C. 10811).

Fees for extraordinary services must be approved by the Court and are in an amount that the Court considers “just and reasonable”.

But fees for ordinary services are set according to the gross value of the estate, without reference to encumbrances or other obligations.  In other words, if your home has a fair market appraisal of $1,000,000 then the fees are set on that amount, even if you have a $900,000 outstanding mortgage!

 Here is the fee table, based on gross value of the estate:

 What does this tell us? First, that everyone needs to avoid probate.  Second, that the smaller the estate, the harder the beneficiaries will be hurt by probate fees. 

Contact a qualified estate planning attorneyin your area, or call the Law Office of Daniel K. Printz at (858) 740-4370 to make an appointment.

“What about going to www.SuzeOrman.com and clicking “will and trust kit” on the left side of the screen. She said on a recent show to use the password “peoplefirst” to get the documents for free.  I bought this package at a KPBS fundraiser a few years ago and it’s the one my family is using. ”

After a certain knee-jerk emotional reaction, I decided that I’d better check out the Suze Orman package before I criticized it.  After all, she’s strongly in favor of estate planning (a position I certainly agree with), and I’ve quoted her admonitions for years to clients.  I certainly would select Suze Orman over, say, legalzoom.

So I went online to check out her program.  I spent about 20 minutes on her site, enough to complete her Advance Directive and Durable Power of Attorney for Health Care (part of any attorney’s basic estate planning package).  I used it as any person would, filling in the form with my personal information and printing out the final document at the end.

 Aside from inputting personal information (address, phone, etc), the program only asked me to make a single decision: (1) to forbid organ donation or (2) to let my agent decide whether or not to donate organs.

 Here are my issues with the document I printed out: 

 1.  Organ Donation – the only choices were ‘no’ or ‘let my agent decide’.  The majority of my clients want to permit donation, but restrict donation to live transplants – otherwise you could end up used for scientific research or education.  Don’t you want a say as to whether you end up as an object for UCSD med students?

2.  No ability to input social instructions.

3.  No instructions regarding nursing care.

4.  No religious instructions.

5.  No burial/cremation instructions.

6.  No specific authority for your agent to select a primary care physician (and what will happen when your health coverage changes?)

7.  Most importantly, only two possible texts for end-of-life decisions (the ‘keep me alive at all costs’ text and the ‘let me die if the burdens of treatment outweigh the benefits of treatment’ text).  I provide my clients with an initial range of five choices, and then modify the texts to personally suit their wishes.

 Someday I’ll go back and do the living trust portion of the kit.  But if there are such large holes in a relatively simple document like a health care directive, what exists in a revocable living trust?  How about distribution to the children?  Do you want them to inherit at age 18?  Can you insert a Spendthrift Provision so they can’t pledge their inheritance as collateral against a loan?  What if you want to treat the children differently from each other?  Can you make sure your brother Egbert with the marijuana plantation isn’t named as the children’s guardian?

 I’ll leave you with Ms. Orman’s own words on the subject, from her disclaimers:

 ”NOTHING HEREIN IS OR SHOULD BE DEEMED TO BE LEGAL ADVICE, TAX ADVICE, ESTATE PLANNING ADVICE, OR ADVICE OF ANY TYPE REQUIRING LICENSING OR AUTHORIZATION UNDER ANY STATE OR FEDERAL LAW OR REGULATION.”  (Capital letters by Suze Orman)

… and …

“No book or form of other published material is a substitute for personalized advice from a knowledgeable lawyer licensed to practice law in your state. THEREFORE, CONSULT YOUR ATTORNEY.” (Capital letters by Suze Orman)

Your Trust can be changed through an Amendment, a legal document that must be drafted and executed with the same procedure that applies to Trusts. Do not change your documents by writing on them or by crossing out words or sentences.

You should review your plan when:

• You get married or divorced
• There are major changes in your family (births or deaths)
• Your children come of age
• You receive a windfall or significant loss of assets
• You no longer find your choice of guardian or executor appropriate
• It has been 3 years since your last review

You should strongly consider a revocable living trust if any of the following are true:

1.    You own real property

2.    You have over $100,000 in gross assets

3.    You want to maintain your privacy

4.    You want to protect your children from squandering their inheritance

How does a revocable living trust accomplish these goals?  It avoid probate by keeping all of your trust assets outside the reach of the probate court. It protects your children against squandering their assets by permitting distribution over time. For example, you can instruct that your children will receive their inheritance 1/3 at age 21, 1/3 at age 25 and 1/3 at age 30.  Finally, the revocable living trust protects against incapacity by providing a technique for a successor trustee to immediately take management control of your property if you are ever unable to manage your financial affairs.

Call us today for a no-cost conversation about revocable living trusts.