A trust is meant to provide financial security, transparency, and peace of mind. A trust is meant to protect family wealth, support loved ones, and manage assets efficiently, but it only works if the trustee follows the rules and responsibilities set by the trust. Unfortunately, that’s not always the case.
Some trustees fail to make payments on time, hide financial details, or mishandle trust money. This can put beneficiaries at risk. If this is happening to you, it’s normal to feel frustrated and unsure of what to do next.
The good news is that California law allows you to take action. If a trustee is not doing their job, you can request their removal and protect your inheritance. In this guide, we’ll explain how to resolve trustee mismanagement through the Los Angeles Superior Court and what legal steps you can take.
Understanding Trustee Mismanagement
What Is Trustee Mismanagement?
A trustee has a fiduciary duty, meaning they are legally required to act in the best interests of the beneficiaries. This means managing the trust’s money wisely, making payments on time, and being open about finances.
Mismanagement happens when a trustee does not do their job properly. This can be because they are careless, unqualified, or acting dishonestly. In many cases, you can even sue the trust for mishandling assets.
Beneficiaries often don’t realize their trustee is mishandling the trust until they experience unexplained delays, missing funds, or a complete lack of communication.
Common Signs of Trustee Mismanagement
If you think your trustee isn’t handling the trust properly, watch for these warning signs:
1. Delayed Payments or Missing Assets
- You should receive your inheritance on time, as stated in the trust.
- If months or years pass without a valid reason, the trustee may be mishandling the trust. It’s best to consult a trust litigation attorney.
2. Refusing to Share Financial Information
- Beneficiaries have the right to see trust financial records.
- If the trustee won’t provide this information or gives vague answers, that’s a red flag.
3. Bad Investment Choices That Lose Money
- Trustees must make smart financial decisions to protect the trust’s value.
- If they make risky or careless investments, they may be violating their legal duty.
4. Using Trust Money for Themselves (Self-Dealing)
- Trustees cannot use trust funds for personal gain.
- If they are overpaying themselves, buying property, or making personal loans with trust money, they are breaking the law.
5. Ignoring the Trust’s Instructions
- The trustee must follow the rules set in the trust.
- If they change terms, delay payments, or make decisions without consulting beneficiaries, they may be violating trust law.
Legal Options for Beneficiaries Facing Trustee Mismanagement
Requesting a Trust Accounting
Under California Probate Code § 16060, beneficiaries have the legal right to ask for a full report showing all trust money and investments. This is often the first step in proving trustee mismanagement.
How to Formally Request an Accounting
- Request in Writing – Ask the trustee for a full financial report with a deadline.
- Keep Records – Save all emails, letters, and responses.
- Take Legal Action – If the trustee refuses, file a petition in Los Angeles Probate Court.
What If the Trustee Refuses?
If the trustee ignores your request or provides incomplete records, the court can step in. It may order the trustee to share full financial details, issue fines for non-compliance, or even remove the trustee if misconduct is found.
Removing a Trustee for Mismanagement
If a trustee isn’t handling the trust properly, you have the right to take action. You can petition the Los Angeles Probate Court to remove them, especially if they are:
- Mismanaging funds or committing fraud
- Delaying or refusing to distribute assets
- Ignoring requests for financial records
- Using trust money for personal gain
After you file a petition, the trustee can respond. Some cases settle through mediation, but if the trustee won’t cooperate, the court may step in. If the judge finds misconduct, the trustee can be removed and replaced.
If you’re dealing with a trustee who isn’t doing their job, learn more about your legal options here: Trustee Removal Services
How the Los Angeles Court Handles Trustee Mismanagement
Before taking a case to trial, Los Angeles courts often encourage mediation. This is a chance for both sides to work out a solution with the help of a neutral mediator. Mediation can lead to a plan for distributing trust funds, the trustee stepping down voluntarily, or better financial transparency. But if an agreement isn’t reached, the case moves to probate court.
In court, a judge will review the trustee’s actions, looking at any financial losses, violations of trust law, or other signs of mismanagement. If the judge finds serious issues, they can remove the trustee, appoint a new one, and even order the trustee to return lost funds or face legal penalties.
See how The Legacy Lawyers are equipped to handle complex trust administration: Trust Administration
Take Action Before It’s Too Late
If your trustee is delaying payments, hiding financial details, or mismanaging assets, you don’t have to wait. Trustees are legally required to act in your best interest, and if they fail, you have options. You can request a full financial report, and if wrongdoing is found, the Los Angeles Probate Court can remove the trustee.
Trust disputes can be complicated, and trustees often push back. A trust litigation attorney can protect your rights and hold the trustee accountable. If you’re dealing with mismanagement, now is the time to act.
Don’t wait until it’s too late. Learn more about Trustee Removal Services in California here or contact The Legacy Lawyers today for a consultation and take control of your financial future.
Your inheritance is too important to leave in the wrong hands. Take action today.
