Breach of Fiduciary Duty

Bucks County Breach of Fiduciary Duty Attorney

When someone is placed in charge of managing an estate or trust, they have an obligation to act with honesty, loyalty, and care. These people are in positions of trust; executors, trustees, and agents all hold such positions. When they abuse that authority or fail to act responsibly, the consequences can be serious.

A breach of fiduciary duty occurs whenever one of these entrusted individuals puts their own interests above those of the beneficiaries. The consequences of a breach can be significant, which is why the law provides you with legal remedies against a fiduciary who doesn’t uphold their duties. Let a Bucks County breach of fiduciary duty attorney review your situation and advise you on how to proceed.

What Is a Fiduciary Duty?

Having a fiduciary duty means that you have a legal obligation to act in the best interest of another person. There are numerous situations where these duties come into play, but they are especially common during the estate planning process. Anyone from executors to trustees has fiduciary duties to those intended to benefit from the trust or estate.

Pennsylvania law has several requirements for a fiduciary. They are expected to be loyal to the beneficiaries and act in good faith. What’s more, they have to handle the property owned by the estate with care. That means the duty goes beyond avoiding fraud or self-dealing, as it requires a level of competence when managing this property.

This duty includes protecting estate assets, following the instructions in a will or trust, and making decisions that benefit the beneficiaries rather than the fiduciary personally.

What’s important to remember is that a breach of fiduciary duty can occur whether intentional or not. These claims often arise when beneficiaries believe that estate assets have been misused or mishandled. Our attorneys can help you determine whether your rights have been violated.

Who Holds a Fiduciary Duty in Estate Planning?

There are different parties and individuals who hold a fiduciary duty in the estate planning process. Some common examples include the following:

Executors and Personal Representatives

Executors manage the estate after someone passes away, and they are the most common example of a fiduciary in this process. This is because they are tasked with gathering assets and distributing property according to the will.

Trustees

Trustees manage assets held in a trust, often for long periods. They must invest and distribute the trust property in accordance with the trust document while treating beneficiaries fairly. Trustees have a duty to act impartially and make decisions that are reasonable for all beneficiaries.

Agents Under a Power of Attorney

Agents acting under a power of attorney have the authority to manage another person’s financial matters. This authority can include handling bank accounts, paying bills, or otherwise managing investments on behalf of another person. Because these agents often act while the principal is incapacitated, misuse of authority can go unnoticed for long periods.

Guardians or Conservators

Guardians manage property for minors or incapacitated adults. They must act in the best interests of the person they represent and carefully manage financial resources.

Consequences of Breaching a Fiduciary Duty

A breach of fiduciary duty can lead to serious legal and financial consequences. Courts take these violations seriously because fiduciaries are entrusted to manage others’ assets.

If a court determines that a breach occurred, the fiduciary may be required to repay any financial losses caused by their actions. They may also have to return profits gained through improper conduct.

In many cases, the court can remove the fiduciary from their role and appoint a replacement to manage the estate or trust. Beyond these financial penalties, fiduciaries may face damage to their personal or professional reputation, especially if the dispute winds up in court. Working with a Bucks County breach of fiduciary duty attorney can help beneficiaries pursue recovery and hold the responsible party accountable.

Common Examples of Breached Duties

Some of the kinds of disputes our Bucks County breach of fiduciary duty lawyers can handle include the following:

Self-Dealing

Self-dealing occurs when a fiduciary uses their position to benefit themselves. This may involve purchasing estate property at a reduced price or transferring assets for personal gain.

Misappropriation of Funds

Using estate or trust funds for personal expenses is one of the most serious violations. This includes withdrawing money, making unauthorized purchases, or diverting assets.

Commingling Assets

Fiduciaries must keep estate assets separate from personal funds. Mixing accounts can create confusion and may indicate misuse of funds.

Failure to Disclose Information

Beneficiaries have the right to receive accurate financial information. A fiduciary who refuses to provide records or hides transactions may be violating their duty.

Mismanagement of Assets

Fiduciaries must act with reasonable care when managing property. Poor investment decisions, neglecting property maintenance, or failing to protect assets can lead to financial loss.

Conflicts of Interest

Fiduciaries must avoid situations where their personal interests conflict with their duties. Failing to disclose these conflicts can result in legal liability.

Reach Out to a Bucks County Breach of Fiduciary Duty Attorney Today

At Klenk Law, we understand what it means when a fiduciary fails to uphold their end of the deal. When these parties fail to protect beneficiaries or engage in self-dealing, it can lead to lasting harm across multiple generations of your family. Reach out to a Bucks County breach of fiduciary duty attorney right away to explore your options.

Frequently Asked Questions

What qualifies as a breach of fiduciary duty?

A breach occurs when a fiduciary fails to act in the best interests of the beneficiaries. This could involve anything from misusing funds to failing to disclose a conflict of interest.

Can I sue a fiduciary in Pennsylvania?

You have the right to sue a fiduciary in Pennsylvania if you are a beneficiary who can show you suffered financial harm due to their actions.

How long do I have to file a claim?

In many cases, Pennsylvania applies a two-year statute of limitations for breach of fiduciary duty claims.

What proof is needed?

You must show that a fiduciary duty existed, that the duty was breached, and that the breach caused financial harm.

Do I need an attorney?

These cases often involve complex evidence and legal standards. An attorney can help build a strong case and pursue recovery.