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The trust and its assets are not the personal piggy bank of the trustees. Rather, the trustees are obligated to administer the trust specifically pursuant to the terms of the trust. In addition, the trustees' fiduciary duty to each beneficiary requires that the trustees provide each beneficiary a full inventory of trust assets and periodic accounting of every dime in and out of the trust. Failure to do so is a breach of the trustee’s fiduciary duty to the grantor of the trust and to the beneficiaries. Such a breach gives the beneficiaries cause to ask the trustee to resign and if the trustee refuses to do so, gives the beneficiaries the right to file a petition with the family court asking the court to order the trustee removed. And, if there has been any misappropriation of estate
assets, the beneficiaries can also ask the court to award actual and punitive damages against the trustee. You don't need case law to sustain a case for breach of fiduciary duty to have them removed. This is covered specifically by the duties imposed upon trustees under the Florida Trust Code. I have provided you the specific statutes below in that Code addressing the trustee's duties for accounting. Since they have failed to comply with these, they have breached their fiduciary duty and can be removed.
(NNN) NNN-NNNNDuty to inform and account.—The trustee shall keep the qualified beneficiaries of the trust reasonably informed of the trust and its administration.
(1) The trustee’s duty to inform and account includes, but is not limited to, the following:
1(a) Within 60 days after acceptance of the trust, the trustee shall give notice to the qualified beneficiaries of the acceptance of the trust, the full name and address of the trustee, and that the fiduciary lawyer-client privilege in s. 90.5021 applies with respect to the trustee and any attorney employed by the trustee.
1(b) Within 60 days after the date the trustee acquires knowledge of the creation of an irrevocable trust, or the date the trustee acquires knowledge that a formerly revocable trust has become irrevocable, whether by the death of the settlor or otherwise, the trustee shall give notice to the qualified beneficiaries of the trust’s existence, the identity of the settlor or settlors, the right to request a copy of the trust instrument, the right to accountings under this section, and that the fiduciary lawyer-client privilege in s. 90.5021 applies with respect to the trustee and any attorney employed by the trustee.
(c) Upon reasonable request, the trustee shall provide a qualified beneficiary with a complete copy of the trust instrument.
(d) A trustee of an irrevocable trust shall provide a trust accounting, as set forth in s. 736.08135, to each qualified beneficiary annually and on termination of the trust or on change of the trustee.
(e) Upon reasonable request, the trustee shall provide a qualified beneficiary with relevant information about the assets and liabilities of the trust and the particulars relating to administration.
736.08135 Trust accountings.—
(1) A trust accounting must be a reasonably understandable report from the date of the last accounting or, if none, from the date on which the trustee became accountable, that adequately discloses the information required in subsection (2).
(2)(a) The accounting must begin with a statement identifying the trust, the trustee furnishing the accounting, and the time period covered by the accounting.
(b) The accounting must show all cash and property transactions and all significant transactions affecting administration during the accounting period, including compensation paid to the trustee and the trustee’s agents. Gains and losses realized during the accounting period and all receipts and disbursements must be shown.
(c) To the extent feasible, the accounting must identify and value trust assets on hand at the close of the accounting period. For each asset or class of assets reasonably capable of valuation, the accounting shall contain two values, the asset acquisition value or carrying value and the estimated current value. The accounting must identify each known noncontingent liability with an estimated current amount of the liability if known.
(d) To the extent feasible, the accounting must show significant transactions that do not affect the amount for which the trustee is accountable, including name changes in investment holdings, adjustments to carrying value, a change of custodial institutions, and stock splits.
(e) The accounting must reflect the allocation of receipts, disbursements, accruals, or allowances between income and principal when the allocation affects the interest of any beneficiary of the trust.
(f) The trustee shall include in the final accounting a plan of distribution for any undistributed assets shown on the final accounting.
(3) This section applies to all trust accountings rendered for any accounting periods beginning on or after January 1, 2003.
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