Protecting Beneficiary Rights

Protecting beneficiary rights honors the intentions of the deceased. When a person bequeaths property to a beneficiary, the executor or trustee has a duty to adhere to the terms of the will or trust. When an executor or trustee violates its duties, the beneficiaries have certain rights under New York law to bring a legal action to protect their rights and seek any of the property bequeathed to them. Furthermore, beneficiaries may remove an administrator or trustee that fails to honor their rights. Beneficiaries seeking to protect their rights should contact Jules Haas, a New York City estate litigation attorney, for a consultation.

Beneficiaries have many rights in connection with a decedent’s estate or trust. Among other things, beneficiaries have the right to promptly receive their share of the estate, as provided in the will. Beneficiaries of wills also have other related rights. They have the right to be truthfully informed about what is happening with an estate and can force an executor to provide them with an accounting of the estate. Within seven months after an executor has been appointed, beneficiaries are entitled to receive a complete inventory of the estate. A beneficiary has the right to an executor who isn’t using the estate for personal gain. Otherwise, a beneficiary is entitled to remove that executor.

Trusts are legal arrangements in which a settlor appoints a trustee to hold and manage assets on behalf of one or more beneficiaries. Trusts can be testamentary or living, with the former only taking effect upon the death of the settlor. Generally, beneficiaries of revocable living trusts don’t have significant rights because the settlor is entitled to modify the terms or remove a particular beneficiary at any point. The beneficiary is entitled to communicate with the trustee and stay informed about trust business. In some cases, a beneficiary may be entitled to distributions. Beneficiaries of irrevocable living trusts or testamentary trusts have much greater rights. They are entitled to be kept informed about trust business; to obtain an accounting that shows profits, losses and distributions; to receive timely distributions according to the trust terms; and to receive communications from the trustee.

Executors, administrators, and trustees need to be cognizant that an estate isn’t their personal property. Their role is to locate and account for all assets and promptly distribute them according to the terms of the trust or will.

When a beneficiary suspects the executor, administrator or trustee has violated his rights, he can bring legal action. The beneficiary can petition the court to compel an executor to perform the duties specified in the will or trust. The beneficiary may also seek the removal of an executor and the appointment of a successor. As a beneficiary, if you’re not sure about whether an executor or trustee is handling the estate or trust properly, it may be appropriate to petition for a compulsory accounting. Under some circumstances, a beneficiary may sue an executor or trustee for breach of fiduciary duty.

Beneficiaries may have a limited window of time within which to assert rights, which makes it important to consult a lawyer right away. For example, if probate has been completed and a beneficiary believes the estate executor is denying him his inheritance, he should take legal action during the estate settlement process. Issues that may be addressed in the course of the settlement process include breach of fiduciary duty, spousal right of election, or fraudulent transfers.

Trustees owe a fiduciary duty to beneficiaries, which means they are obliged to act in the beneficiaries’ best interests and fulfill the trust terms. Under New York law, it may be possible to remove a trustee by bringing removal proceedings in Surrogate’s Court under certain circumstances. These reasons include: the trustee’s failure to account, the trustee’s unfitness, the trustee becomes ineligible by statute, the trustee becomes unqualified because of substance abuse or other factors, the trustee disobeys the court, the trustee removes property for personal use, or the trustee was chosen due to a false statement of material fact. Generally, a trustee will only be removed in extreme circumstances.

If you are worried about the issues that arise in protecting beneficiary rights, you should contact Jules Haas for a free case review. As a lawyer, Mr. Haas has handled New York City estate litigation for more than three decades and offers reasonable fee arrangements. He represents people in Manhattan, Queens, the Bronx, Kings, Nassau, Richmond, Suffolk, and Westchester Counties. Call us at (212) 355-2575 or contact us through our online form.