Expert: Janet Brewer - 3/25/2009

Question
I have a sibling who became Trustee (of a Trust in California) after the death
of our mother.  I have another sibling who moved into our mother's house
and moved our mother out, without her consent.  Two months later my
mother died unexpectedly. Sibling number 2 took position of the home and
said they would contribute nothing to home.  Sibling number 2 was given oral
notice to leave within 60 days by the Trustee and Sibling #2 refused and will
only contribute $300.00 a month to home that rents for $2,000.   There is no
rental agreement ect and the Trustee continues to allow the sibling to remain
on property.  In addition, it was discovered that Trustee signed a Real Estate
Listing  Agreement 2 months prior to the death of Trustor and Trustee signed
it as POA.  Note the property was recorded into the Trust.  The Estate of the
home was cleaned out with no notice to all 7 beneficiaries and was even sold.  
No itemized list of what was taken and what was sold and what became of
the funds from the sale of the belongs.   Now is has been discovered that  
house has entered Escrow with no notice from the Trustee.  In fact, Trustee
believes that the information does not have to be shared at this time.   The
beneficiaries don't know for how much, or any of the terms of sale.  It
appears the Trustee entered into a fraudulent POA listing agreement before
the death of the Trustor and continues to ignore disclosure on other matters
of the Trust that the beneficiaries have requested and continues to withhold
some information to certain beneficiaries.  Is it correct to assume that Trustee
has been negligent with her fiduciary duties?

Answer
Thanks for letting me know that California law applies.  

To answer your question, based on the information you've provided, it seems very safe to assume that the trustee has been negligent.  I had a situation similar to this a few months ago (in that case the real estate agent was another sibling & neither one would give my client any information about what was going on).

Given this real estate market, the practical thing to do might be to let the sale go forward ... assuming that the price is reasonable & you don't think the house is being sold to a "crony" for less than fair market value.

Unless you can show an emergency (arguably, selling the house without any kind of information regarding fair market value could be construed as an emergency), you need to give the trustee 60 days' notice that you want an accounting.  If you can prove to the court that there's an emergency, you can file an immediate petition to compel an accounting.  You might also be able to get a "lis pendens" on the house to stop the sale (again, given this market, that might not be such a great idea).  At the very least you can probably get a court order blocking distribution of the sales proceeds pending resolution of this matter.

With a strong enough case (that is, sufficient recitation of "bad acts" by the trustee), you might even be able to get all of this on an "ex parte" basis (where the judge hears the case within 24 - 72 hours after you file your petition and you give only minimal notice to the trustee & the other beneficiaries) - otherwise, you would have to wait to get on the "regular" court calendar, which would take a minimum of 30 to 45 days.

This information is not intended to substitute for professional legal advice and does not create an attorney-client relationship. You should accept legal advice only from a licensed legal professional with whom you have an attorney-client relationship.