Breach of Fiduciary Duty

When someone passes away, the law places enormous trust in the person responsible for managing the estate. Executors and trustees have an obligation to act in the best interests of the estate and its beneficiaries. Unfortunately, that trust is sometimes broken.

A breach of fiduciary duty occurs when a person entrusted to manage estate assets fails to act in the beneficiaries’ best interests. These actions can lead to costly financial losses, difficult family disputes, and even litigation that drags on for years. If you believe an estate has been handled inappropriately, now is the time to reach out to a Philadelphia breach of fiduciary duty attorney.

What Is Fiduciary Duty?

A fiduciary duty is a legal obligation to act in someone else’s best interests. In estate law, this duty applies to anyone who has been appointed to manage or control the property of an estate.

Each of these individuals must adhere to strict legal standards and can be held personally responsible if they fail to do so. A Philadelphia breach of fiduciary duty attorney can help you hold these fiduciaries accountable when they violate their obligations.

Common Fiduciaries in Estate Administration

Some of the roles that typically come with a fiduciary duty include the following:

Executors of an Estate

An executor is responsible for administering a deceased person’s estate. This role typically involves collecting assets, paying debts, filing tax returns, and distributing property according to the will. When they fail to carry out these responsibilities properly, beneficiaries may have grounds to challenge their actions in court.

Trustees

A trustee manages property that has been placed in a trust. Trustees often control significant assets for extended periods, especially when trusts benefit minor children or provide ongoing financial support. That means they must invest responsibly while avoiding conflicts of interest.

Because trustees often have broad authority to oversee these assets, misconduct can remain hidden for years. If you suspect a trustee has overstepped their authority or is involved in self-dealing, a Philadelphia breach of fiduciary duty attorney can help.

How Breaches of Fiduciary Duty Occur

Some of the ways a person can breach a fiduciary duty include the following:

Misusing Estate Funds

One of the most serious violations occurs when a fiduciary uses estate funds for personal purposes. This may involve transferring money to personal accounts or using estate assets to benefit themselves or their family members. Even small amounts of money can snowball into a bigger dispute, especially if they keep occurring over time.

Self-Dealing

Self-dealing occurs when a fiduciary enters into transactions that benefit themselves rather than the estate. This might mean selling assets to a friend or family member below market value. The key in these disputes is to determine whether someone else benefited at the beneficiary’s expense.

Failing to Follow the Will or Trust

Fiduciaries must carry out the instructions provided in the will or trust documents. Ignoring those instructions can create serious legal issues. For example, distributing property to the wrong beneficiary or failing to distribute assets at all can constitute a breach of fiduciary duty.

Poor Recordkeeping

Not all breaches of fiduciary duty involve self-dealing or fraud. Some executors simply fail to keep proper records of their transactions, making it impossible for beneficiaries to keep track of what happened to certain trust assets.

Failure to Act

Sometimes the problem is not active misconduct but inaction. Fiduciaries must move the estate administration process forward within a reasonable timeframe.

Who Can Be Held Responsible?

There could be an array of parties who are ultimately responsible for a breach of fiduciary duty. These parties, who might also be at fault, include:

• Executors or personal representatives
• Trustees
• Agents acting under a power of attorney
• Guardians or conservators

In some cases, outside parties might also be at fault if they knowingly participated in improper transactions involving estate assets. This could include anyone from attorneys to financial advisers involved in the transaction.

The Benefits of Hiring an Attorney

If you suspect a person in control of an estate has breached their fiduciary duty, it’s time to seek out legal counsel. A Philadelphia breach of fiduciary duty attorney can help in the following ways:

• Identifying fiduciary misconduct. Estate mismanagement is not always obvious. An attorney can review financial records, trust documents, and probate filings to determine whether the executor or trustee has violated their legal obligations.
• Demanding a formal accounting. Beneficiaries have the right to understand how estate assets are handled. A lawyer can request detailed financial disclosures from the fiduciary and require the fiduciary to explain how the funds were spent or distributed.
• Recovering misused assets. If a fiduciary has improperly taken money or property from the estate, legal action may be necessary to recover those assets. An attorney can pursue claims that force the fiduciary to repay losses or return property to the estate.
• Removing an unfit fiduciary. When an executor or trustee continues to mishandle estate assets, the court may remove them from their position. A lawyer can file the necessary petitions and present evidence showing why the fiduciary should no longer serve.
• Protecting beneficiary rights in court. Estate disputes sometimes escalate into probate litigation. An attorney can present evidence, question financial records, and advocate for beneficiaries during court proceedings.
  Working with our team gives you a chance to protect your rights and ensure the trustee or executor is held accountable for their mistakes.

Reach Out to a Philadelphia Breach of Fiduciary Duty Attorney Today

The breach of a fiduciary duty is a serious matter. When you learn that your rights have been violated, it’s critical that you talk to an attorney about your options right away. At Klenk Law, we understand what this violation can mean to you and your family. Reach out today to discuss your options during a private consultation.