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The trustee of any trust, absent specific directives in the trust, is liable for only reasonable and prudent management and to make reasonable business decisions on behalf of the trust. As long as the trustee makes such reasonable effort they are not breaching their fiduciary duty
to the trust. The trustee does not have to make the best of all business decisions, just decisions that a reasonable person with the same skill and experience of the trustee would find reasonable under the same circumstances.
Thus, if you pulled out of the market because of the economic downturn in 2008+, this would arguably be reasonably prudent and while the grantor may be complaining about this, it is likely going to end up spending money out of his trust for your legal defense and ultimately show your actions were reasonable and prudent. Unfortunately, you will need an attorney to represent you in this matter as trustee and when you win the suit the trust will be liable for paying your legal fees unless the court orders the plaintiff to pay those fees, as long as you can show you were in reasonable performance of your job as trustee.
The trustee is only liable if the owner or heirs can prove they acted negligently or in a reckless and wanton manner, and there is no economist in the country who would tell any court credibly that removing money from the market at the beginning of the crash was a negligent, reckless or wanton move.
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