California Trustee Make a Mistake? File a Petition for Blocked Accounts

Trustees in California must treat all beneficiaries equally, carry out the terms of the trust, and manage trust assets. Unfortunately, trustees sometimes make mistakes. One example of a mistake is when a trustee makes a distribution to the wrong beneficiary. Perhaps the trustee misinterpreted the trust instrument, California trust laws, or is administering the trust without the guidance of an experienced attorney. Regardless of the cause, there are solutions available to the rightful beneficiary.

If a trustee fails to correct a mistake even after it is pointed out, you may have to consider your legal options. One such option for a beneficiary who is not receiving his or her rightful trust distributions is to file a Petition for Instructions and Blocked Accounts. The following are facts about how this legal remedy can help you:

• The Petition can ask the Court to instruct the Trustee to follow the Trust terms.
• The Petition can ask the Court to order a Blocked Account.
• If the Court orders the Blocked Account, the Trustee must set it up and deposit the Trust funds.
• Trust property cannot be withdrawn, transferred, or spent from this account without a Court order that authorizes the action.

When a Trustee is mistakenly distributing out Trust assets to the wrong beneficiaries, filing a Petition for Instructions and Blocked Account can help protect the remaining property. The blocked account will freeze the assets while the lawsuit against the Trustee is carried out.

If you are ready to start your case, then please give us a call or fill out our Get Help Now form.  If you want a comprehensive overview of California Probate, then click here. Should you have additional questions about trust litigation, then you will find plenty of useful information in our Learning Center.