Case Study 4

Choosing the Right Fiduciary to Administer Your Estate

It’s important to choose the right people to carry out your intent under a will. Your will appoints an executor who is the person you’ve chosen to wind up your estate at your death. You may also appoint a trustee under a will or a trustee under a Revocable Trust. A Trustee manages assets for a beneficiary of your property. Often, the executor and the trustee can be the same person but it doesn’t have to be that way. You can name two different people to serve in those capacities. What happens if you make the wrong choice and the person you’ve chosen is unable to perform his duties as your fiduciary? Consider this scenario.

Many years ago, Harold created a will with a testamentary trust. Harold was a hard worker and managed to accumulate several assets during his life, most of which were tied up in real estate. Harold went to the lawyer that his father used when he was alive. That lawyer created a will and the will had a testamentary trust provision under which Harold appointed his son (a truck driver by trade) as trustee over the remainder of Harold’s estate. The trust was for the benefit of Harold’s wife, Barbara. Harold then died and whatever he owned was now placed in this testamentary trust. The probate court then appointed Harold’s son, Frank, as the trustee of this trust, as was Harold’s wish under the will. Unfortunately, Barbara was old, frail and bed-ridden when Harold died and she also suffered from severe dementia. Thus, she was unable to act as a check and balance over the testamentary trust that her husband created for her. As for Frank, he was relatively unsophisticated and relied on the lawyer who drafted the will, to guide him through his responsibilities.

One year after the probate court appointed Frank, a periodic accounting was due to the court. Since Frank was not a lawyer, he had no idea regarding what the court expected of him. So he went to the lawyer who created the will and asked him for help in putting that together. Unfortunately for Frank, the lawyer never drafted the periodic account and Frank received a notice from the court, reminding him that the account was now overdue. Strike one. In that notice, the court established a new deadline for receipt of the periodic account and told Frank that if it did not receive the account by that deadline, Frank risked being removed as the trustee. The second deadline came and went and when Frank asked his lawyer about the status of the periodic account, the lawyer hastily put one together, had Frank sign it as trustee and then submitted it to the court. The court was not pleased with the accounting, as it was tardy and it was fraught with errors and omissions. The court sent Frank another notice, setting a new deadline and this time, advised Frank that if it did not receive an accurate periodic account, Frank would be removed as trustee. Strike two. Frank was in an awkward position. He knew he had to answer to the court but he was also trying to honor his father’s wish, by putting his trust in the very lawyer who drafted his father’s will. Unfortunately, Frank missed the third deadline and once again, his lawyer hastily drafted a new periodic account - riddled with mistakes – and filed it two weeks after the deadline. The court was left with no choice but to remove Frank as the trustee.

Connecticut General Statutes § 45a-242(a) states that the probate court may – on its own motion – remove any fiduciary if (1) the fiduciary becomes incapable of executing his trust, neglects to perform his duties or wastes the estate, (2) there is a lack of cooperation among co-fiduciaries that substantially impairs the estate, (3) the fiduciary is unfit or unwilling to perform or he persistently fails to administer the estate effectively or (4) there is a substantial change of circumstances, removal is requested by the beneficiaries or the court determines that removal is in the best interests of the beneficiaries and there is a suitable replacement available. The probate court will appoint a suitable person to act as a successor fiduciary, in place of the person being removed.

In this case, the court removed Frank as trustee and appointed an experienced estate attorney to act in the capacity as successor trustee. That person then marshaled the assets of the testamentary trust and was able to provide the probate court with an accurate periodic account. The new probate attorney protected the trust estate and the beneficiaries’ interests in that estate.

This story demonstrates how important it is to choose the right person to act in the best interests of your estate, as well as in the best interests of your loved ones. It also illustrates how important it is to choose a competent lawyer to help you, not only with your estate plan but also with the administration of your estate after you’re gone. If you have questions about making a will, creating a trust, choosing a fiduciary, or preparing an accounting, please contact the experienced estate planning attorneys at Cipparone & Zaccaro, PC. We’d be happy to help you.

About the Author  (click image for contact information)

We are pleased to announce that Mark Pancrazio has joined Cipparone & Zaccaro, P.C. Mark brings a wealth of experience in various areas of the law, including estate and trust administration, estate and trust litigation, estate planning, conservatorships and probate law. Mark is currently a member of the Elder Law Section of the Connecticut Bar Association and a former member of the Western Connecticut Senior Alliance. Mark practiced law in Danbury, CT before joining the firm.

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