Following a death in the family, most beneficiaries expect the process to be handled professionally and smoothly. Both the executor of an estate and/or the trustee responsible for managing a trust have a fiduciary duty to act in the best interest of the estate or trust’s beneficiaries.
But that isn’t always the case.
Whether it’s simply failing to keep beneficiaries informed, a disagreement among family members, or something more serious like executor misconduct, an attorney can help protect beneficiaries’ rights during trust and estate litigation.
When fiduciaries don’t live up to their responsibilities, beneficiaries can easily be left in the dark, or worse, risk losing assets they rightfully stand to inherit.
As a beneficiary, understanding your rights plays a key role in how to protect an inheritance during litigation.
Understanding Beneficiary Rights in Trust Litigation in Illinois
If you’ve been named as an heir or beneficiary in Illinois, there are a few very important rights you have that you must understand.
First is the right to information. Beneficiaries generally have the right to obtain a copy of the trust agreement or will, including any amendments to it.
As a named beneficiary, you also have the right to receive any distributions you’re entitled to in a timely manner. Once debts are paid and taxes resolved, fiduciaries cannot withhold or unreasonably delay distributions that a beneficiary is rightfully entitled to.
Beneficiaries also have the right to an accounting of estate or trust assets. Executors in probate estates are subject to court-supervised accounting and reporting. In the case of a trust, an accounting should be given annually to beneficiaries that includes all the assets held by the trust, as well as its debts and liabilities.
If there are assets being invested by the trustee, beneficiaries have a right to know how they are being managed. In addition, trust beneficiaries are also entitled to see the distributions that have been made, along with explanations and accompanying receipts.
Lastly, beneficiaries have the right to challenge fiduciary conduct. If you suspect that a trustee or executor is mismanaging assets, acting in their own interest over the interests of beneficiaries, or withholding information, you have the right to petition the court for relief.
What Leads to Trust and Estate Litigation in Illinois
The goal of estate planning is to streamline the process of distributing one’s assets after they pass, but that doesn’t mean the process will always be without friction.
Most trust and estate litigation begins for one of several common reasons. If you suspect any of these issues are occurring, consulting a trust and estate litigation attorney may be in your best interest.
Lack of Transparency
Under Illinois probate and trust law, both executors of a will and trustees responsible for managing a trust have a fiduciary duty to keep the beneficiaries informed and notified of what’s happening. Fiduciaries are required to inform beneficiaries of the assets held by the estate or trust, as well as provide an annual accounting of each significant payment and distribution.
When fiduciaries delay or fail to give proper updates, withhold information, or ignore communications from beneficiaries, disputes can arise.
Suspicion of Financial Misconduct
As part of their duty, executors and trustees are expected to make decisions that are in the best interest of the trust beneficiaries. In most cases, fiduciaries are not entitled to use estate or trust assets for their own personal benefit. When a trustee makes decisions that benefit themselves over the interests of beneficiaries, known as self-dealing, it is a breach of fiduciary duty by the trustee.
Possible examples of self-dealing can include improper withdrawals from trust accounts, unexplainable fees or reimbursements, or mixing their personal funds with trust funds. Self-dealing isn’t always stealing. It could be buying trust property at a favorable price, selling personal property to the trust, or other conflicts of interest.
Executor or Trustee Misconduct
Beyond financial misconduct, executors and trustees sometimes neglect other responsibilities. Sometimes they delay distributions without cause, undervalue particular assets, or even sell properties without authority.
Even if not done intentionally, executor misconduct can affect beneficiaries’ rights by making decisions that improperly favor one beneficiary over another.
Disputes Between Beneficiaries
Fiduciaries aren’t the only source of conflict in estate litigation. Sometimes family members themselves can drive conflict when they feel there has been an unequal distribution of assets, or that the language of the will or trust has been misinterpreted.
Family disputes are often one of the biggest drivers of estate litigation in Illinois, particularly when there are significant assets at stake.
Accusations of Undue Influence or Lack of Capacity
One of the more serious reasons for estate litigation is accusations of lack of capacity or undue influence. These claims can arise when there were significant changes to estate planning documents late in life or under suspicious circumstances.
If the decedent (deceased) suffered from any sort of mental or cognitive impairment, such as Alzheimer’s disease, an argument could be made for lack of capacity. Or if a relative or caregiver pressured the decedent to make changes to their will or trust that favored them, it could potentially constitute undue influence.
When there is reason to suspect that any of these issues may have occurred, it can be worth consulting a trust and estate litigation attorney to understand your options.
How an Attorney Protects Beneficiaries During Trust and Estate Litigation
For beneficiaries who encounter any of these issues, engaging with a trust and estate litigation attorney can help you protect your interests and ensure that fiduciaries are abiding by their responsibilities.
One of the first ways an attorney can help is by forcing transparency. They can look over the trustee’s shoulder, making sure that they abide by Illinois law. An attorney can examine whether distributions match the trust terms, whether the documented expenses are reasonable, and whether any conflicts of interest exist.
If a fiduciary refuses to provide an accounting or ignores communications, an attorney can demand a full trust accounting. They can request a complete asset inventory, bank records, and documentation for every distribution. If the trustee refuses, the attorney can escalate through court.
Beneficiaries sometimes assume that they need absolute proof of theft or trustee misconduct before contacting an attorney, but you don’t have to wait for a total loss to get help. Sometimes poor recordkeeping, unreasonable delays, or conflicts of interest can be recognized as a breach of fiduciary duty.
If there is reasonable suspicion that the fiduciary is improperly managing assets or engaging in misconduct, getting an attorney involved at the earliest signs of a breach of fiduciary duty by a trustee can help prevent major losses before they occur. An attorney can build evidence for a claim of misconduct before losses grow, so that you have a documented case before bringing a legal claim.
While most trust and estate litigation issues don’t proceed to a full trial, disputes may involve the Illinois probate court. If needed, an attorney can file a petition to seek removal of the trustee or executor or request an injunction to stop the movement of assets. Through the court, it may be possible to recover lost assets, but the longer you wait, the more difficult it will be to recover them.
What the Process of Working With a Trust and Estate Litigation Lawyer for Beneficiaries Looks Like
Some beneficiaries delay consulting a legal professional for fear that it can create a deep family rift. However, working with a trust and estate litigation attorney does not automatically mean that a case will ever proceed to trial.
In fact, a trial is typically a last resort. Most attorneys will make efforts to resolve a dispute outside of court.
When you do decide to consult with an estate and trust litigation lawyer for beneficiaries, there are several phases that will try to resolve the issue before ultimately resorting to a trial.
1. Pre-litigation Investigation
To protect beneficiaries during estate litigation, an attorney will begin by requesting a full accounting and review of estate or trust documents and financials. This gives them a baseline of the process to this point. If the fiduciary refuses, the attorney can submit an informal demand letter.
2. Filing in Probate Court
If the fiduciary will not provide an accounting, then a petition in probate court may be needed to compel an accounting or address claims of breach of fiduciary duty.
3. Discovery Phase
This phase is where the bulk of evidence is collected. Both sides can exchange emails and communications related to the estate or trust, financial records, banking history, and even witness testimony when appropriate.
4. Mediation and Settlement Negotiation
Most families in Illinois want to avoid prolonged conflict, especially when emotions are already running high after a family member’s passing. It isn’t just about keeping the family peace, though. Litigation costs eat into the value of the estate or trust. An attorney can help negotiate a settlement without going through a trial.
In fact, judges will often encourage a settlement rather than a trial whenever possible.
5. Trial if Necessary
Sometimes a settlement simply cannot be reached. In these cases, a trial is the last option. In that case, a judge will decide if the fiduciary has breached their duty, and what remedies may be appropriate.
Possible remedies include removal of the trustee, damages, or other corrective actions.
Staza Law: Chicago Trust and Estate Litigation Attorneys
Fiduciaries have a responsibility to act in the best interest of estate or trust beneficiaries. When they don’t, estate or trust assets can be lost or squandered.
Whether you’re dealing with a family dispute, lack of transparency, or missing trust assets, Staza Law is ready to help protect beneficiaries’ rights during trust and estate litigation.
Based in Chicago, we help Illinois families investigate executor misconduct and protect inheritance during trust and estate litigation by holding fiduciaries to the standard expected by Illinois law.
If you suspect executor misconduct, the sooner you contact an attorney, the better the chance to preserve beneficiary rights in trust and estate litigation.
We offer a free initial consultation to listen to your case and help you take the next step. Contact Staza Law today.