Can You Sue a Texas Trust?

When individuals think about creating a trust, they often envision the protection of assets that comes along with such a legal entity. However, they may not consider the lawsuits that may be brought in connection with managing the trust. Being the trustee of a trust is a major responsibility, but if the trustee is not acting according to the trust creator’s wishes, legal action may be brought. Below are common questions and explanations about Texas trusts and when legal actions can—and should—be brought against a trustee.

What is a Trust?

A trust is a legal entity that manages assets on behalf of one or more people who are given the assets, called beneficiaries. The individual who manages the assets in the trust is called a trustee. Being a trustee is a time-consuming and critical role, so a person should not take on this position lightly. It can come with benefits—ensuring the assets in the trust are being distributed and managed according to the trust creator’s wishes—but also drawbacks too.

How—And Why Would I—Sue a Texas Trust?

Because a trust is a legal entity, a person cannot sue a trust. However, they can sue the trustee of a trust. Trustees are legally bound—in what is called a fiduciary duty—to manage the assets in the trust according to the wishes of the trust creator and in the best interest of the beneficiaries. So, if a beneficiary believes the trustee is not following their fiduciary duty, they can bring a lawsuit.

Examples of a Breach of Fiduciary Duty

A breach of fiduciary duty may include not paying beneficiaries the assets they are entitled to in a timely manner or if the trustee uses the assets for their own benefit. To be successful in bringing this type of lawsuit, the individual must prove the trustee is disobeying the wishes of the trust creator or is acting in some other egregious way that can be viewed as a breach of their duty.

It is also important to note that there is a distinction between suing a trustee and contesting a trust. While suing a trustee tends to involve seeking monetary damages or having the trustee removed, contesting a trust is challenging the terms of the trust itself. This would instead be arguing that the trust grantor was coerced when creating the trust or that the trust has been fraudulently altered.

Because suing a trustee is a complicated endeavor, individuals thinking about going through this process should contact an experienced estate planning attorney to help.

Contact a Houston Estate Planning Attorney

If you or a loved one believes a lawsuit should be brought against a trustee, contact the Houston estate planning attorneys at McCulloch & Miller, PLLC. Our lawyers have decades of experience fighting on behalf of individuals who believe trustees are breaching their fiduciary duty. Besides bringing these lawsuits, our attorneys also work to create estate plans for Texans and their diverse needs. To schedule a consultation and to speak with one of our knowledgeable attorneys, give us a call today at 713-333-8900 today.

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