Trustees serve their beneficiaries in a fiduciary capacity. This means they are responsible and accountable for the management of trust money, property and other assets on behalf of their clients. Under Texas state law, a beneficiary may request the trustee to deliver a written statement of accounts covering all transactions to ensure their trust is being properly managed. This statement is called a “trust accounting.”
At the law firm of Morris Ostrom Law, our Houston trust litigation lawyers have extensive experience representing clients in disputes with trustees, probate court, estate executors and guardians, including disputes dealing with contesting trust accountings.
If you are the beneficiary of a trust and have received an accounting that suggests a breach of fiduciary duty, or have failed to receive any kind of accounting, you may have a claim against the trustee.
Responsibilities of Trustees to Beneficiaries
A trust is a fiduciary relationship that allows a third party, or trustee, to hold title to money, property and other assets on behalf of a beneficiary or beneficiaries. It is designed to protect the assets and preserve the wealth of the plan’s beneficiaries. Title 9 of the Texas state property code describes the responsibilities and duties of a trustee.
Texas state law specifies that a “trustee shall administer the trust in good faith” and that “a trustee shall invest and manage the trust assets solely in the interest of the beneficiaries.” Trustees who fail in this duty may be liable for any monetary losses or damages that result.
Fiduciary Accounting for Trusts in Texas
A beneficiary has a right to request certain information from the trustee, such as a written accounting of all of the trust transactions from inception or since the last accounting. The beneficiary must submit this request in writing. However, the trustee is not obligated or required to produce an account more frequently than once every 12 months unless a more frequent accounting is required by the court.
In Texas, the trustee is given 90 days to prepare and deliver the accounting statement. If they fail to do so, a beneficiary may file a lawsuit to compel the trustee to deliver the statement.
The written statement of accounts provided to a beneficiary must show:
- All trust property that has come to the trustee’s knowledge or into the trustee’s possession and that has not been previously listed or inventoried as property of the trust.
- A complete account of receipts, disbursements, and other transactions regarding trust property for the period covered by the account, including their source and nature, with receipts of principal and income shown separately.
- A listing of all property being administered, with an adequate description of each asset.
- The cash balance on hand and the name and location of the depository where the balance is kept.
- All known liabilities owed by the trust.
Get Help Contesting Trust Accountings in Texas
If a beneficiary feels there are errors in the report prepared by the trustee they have the option of contesting trust accountings in court. Some of the reasons a beneficiary for contesting trust accountings include:
- The trustee’s accounting is incomplete or inaccurate.
- The trustee is not following the terms of the trust.
- The trustee fails to provide an accounting annually or 90 days after a written request.
- Property and other assets are being mismanaged or not sensibly invested.
Contesting trust accountings because of inconsistencies and discrepancies requires the help of an experienced Texas trust litigation lawyer.
Morris Ostrom Law is a Houston-based law firm that has been successfully representing individuals throughout Texas in trust litigation and other fiduciary litigation issues for many years. We can assist you with any legal problems related to trust accounting, inheritance law, will contests, guardianships, property rights, will forms and more.
You can depend on the fiduciary litigation lawyers at Morris Ostrom Law to dedicate the time and resources necessary to resolve your legal issues. To discuss your Texas trust litigation issue, call Morris Ostrom Law today at (888) 869-9015 or email firstname.lastname@example.org.