Court Authority Over Family Trusts
WHICH COURT HAS JURISDICTION OVER FAMILY TRUSTS?
The answer depends on where the trust was formed, where its assets are located, and the terms of the trust agreement. However, in most cases, an inter vivos (often called “family”) trust that is formed in California by a California settlor* falls within the general jurisdiction of the California Probate Courts. Depending on the facts and circumstances, other courts may be or become involved in trust-related matters, but generally speaking, the court of first resort will be the California Probate Court.
*(“settlor” is the legal term for a person who establishes a trust)
MANY INTER VIVOS (FAMILY) TRUSTS CAN BE ADMINISTERED WITHOUT COURT SUPERVISION
In many cases, an inter vivos trust can be administered without court involvement. In fact, most inter vivos trusts are designed to be (and are) administered outside of probate–and without court supervision.
Inter vivos trusts usually are administered outside of court:
- During the lifetime of the settlor**
- After the settlor’s death, when the trust agreement permits (which, as mentioned above, is the normal situation)
** If the settlor becomes incapacitated or incompetent, it may be necessary to go to court, at least to obtain approval of the successor trustee. In some cases, the court may wish to maintain some level of supervision thereafter, depending on the facts and circumstances.
WHEN DO INTER VIVOS TRUSTS REQUIRE COURT SUPERVISION?
Although inter vivos trusts normally are designed to be administered without court supervision, the settlor and/or the trustee of the trust always have authority to petition the court for assistance. In addition, there are circumstances in which trust beneficiaries and/or the settlor’s heirs may petition the court to request supervision, assistance, instructions, or decisions.
A few of the more common situations in which a court may exercise jurisdiction over an inter vivos trust include:
- Resolving issues involving creditors and debtors/debts of the trust
- Resolving any disputes in which the trust is a party, or involving the assets of the trust
- Enforcement of the trust
- Resolving challenges (also known as “contests”) to the trust and its contents
- Requesting that a trustee provide an accounting of trust assets, or explanations of activities involving the trust
- Resolving questions or disputes about the “internal affairs” of the trust.
- Providing instructions to the trustee, at the request of the trustee or (in appropriate circumstances) other people
If you have concerns about the way a trust is being administered, or believe a court should (or should not) be involved, contact an attorney promptly for an evaluation of your legal rights and potential claims. You may lose the right to make a challenge, or to pursue your claims, if you delay–particularly if you have received a statutory or other official notice about the trust or the relevant proceedings.
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Disclaimer: THIS ARTICLE IS FOR INFORMATIONAL PURPOSES ONLY, AND DOES NOT CONSTITUTE LEGAL ADVICE OR CREATE AN ATTORNEY-CLIENT RELATIONSHIP BETWEEN THE AUTHOR OR ROSS LAW AND ANY PERSON. Your legal rights and experiences may vary. Never use an online article (including this one) to evaluate your legal rights or claims. Consult an experienced attorney promptly to obtain a personalized evaluation of your claims, potential damages, and the various legal rights and options available to you.
You may lose or compromise your rights if you delay in consulting legal counsel. Most legal claims (and defenses), as well as legal and court procedures, are complicated and fact-dependent. If you believe you have a claim against someone who injured you, a lawyer who represented you in a previous lawsuit, or any other legal claim, consult an experienced lawyer immediately for an evaluation of your individual rights and claims.
