Appointing a Trustee in your Estate Plan

People can feel overwhelmed by the number of choices they must make when drawing up estate plans. It can be particularly difficult when one’s plans include strategies to increase the value of their estate, such as using trusts to hold particular assets. One of the most important choices a will writer has to make when creating a trust, particularly for their estate plan, is choosing who will be the trustee or trustees. In this blog, we’ll discuss some things will writers should consider before choosing who to appoint as trustee.

Trusts in the Context of Estate Planning

First, let’s review the basics of using trusts in your estate plan. There are many types of trusts you can employ in your estate plan, each with their own unique benefits. In simple terms, a trust is a type of account which can hold almost any asset you wish. You choose who is to receive the contents of the trust, often money or real estate, and when and on what conditions they are to receive it. You must appoint a trustee to oversee the account, holding it for the benefit of your beneficiary. Depending on the type of trust you use and the nature of the assets in the account, the trustee will have different responsibilities.

Qualities of a Good Trustee

Many people assume it is a good idea to appoint a loved one as their trustee. We should remind will writers that a trustee’s ability to do their job is not about their personal character, but their ability to skillfully execute the trustee tasks. Trustees have a fiduciary duty, and must do what is right by the trust. They are legally bound to carry out tasks as detailed in the will writer’s estate plan. Some other things a will writer should ask themselves while considering who to appoint are:

• Experience: Does this person have prior experience executing the tasks of a trustee? Are they competent in completing admin tasks such as keeping track of an account and documents?
• Willingness: Is this person ready to accept the responsibility of being a trustee in your estate plan?
• Future ability: Is this person planning on staying in British Columbia for the foreseeable future? Are they expecting a change in their lives which will impede their ability to oversee the trust in the future?

If an Appointed Trustee is Not Acting Reasonably

In British Columbia, trustees are legally bound to act reasonably and for the benefit of the beneficiaries of the trust. If they aren’t acting responsibly, or draw some personal benefit from the trust, interested parties are able to remove them from their role. Those with an interest in the estate can make an application under Section 30 of the Trustees Act. Parties applying for the removal of a trustee must prove to the Court that the trustee has breached their duty.

In many cases, the failing trustee did not intend to cause any harm to the trust, and didn’t try to draw personal benefit from the trust. Often, they simply did not understand the scope of their responsibilities as a trustee, or how to administrate the trust effectively. This demonstrates why it is often more important to appoint a competent trustee rather than a loved one. Some people choose to appoint a professional to oversee their trusts.

If you’re concerned about choosing a trustee in your estate plan, or you’re the beneficiary of a trust being mishandled by the trustee, contact an experienced estate lawyer today. We’ll make sure the trust is cared for in your best interests.

Have a question about this topic or a different legal topic? Contact us for a free consultation. Reach us via phone at 250-888-0002, or via email at info@leaguelaw.com.