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Barrister
Barrister, Attorney
Category: Estate Law
Satisfied Customers: 37862
Experience:  16 yrs estate law, real estate. Wills/Trusts/Probate
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I have a case of fiduciary breach of a revocable education

Customer Question

I have a case of fiduciary breach of a revocable education trust...it specifies the duty of annual accounting to beneficiaries. In 2008 an accounitng was requested...but denied unless a fee of $5000 was tendered. How would MS law usually view this? eg attorneys fees of the beneficiaries and/or extraordinary "forensic" accounting fees. ?
JA: Since laws vary from place to place, what state is this in? What confuses you?
Customer: Good question...the plot thickens there. My Dad, settlor created the trust in MS and specified MS Trust Code as authority for administration. A few years later he moved to Texas where the Trustee and all the beneficiaries reside. He passed in Texas some years later...hopefully the case will be heard in Tx but the Trustee seems intent on having it heard in MS.
JA: What documents or supporting evidence do you have?
Customer: The Trust, death certificate...other misc... what would be required?
JA: Anything else you want the lawyer to know before I connect you?
Customer: In Texas an accounting is required upon demand...no or minimal cost. Can the $5000 barrier request in MS be sustained?
Submitted: 8 months ago.
Category: Estate Law
Expert:  Barrister replied 8 months ago.

Hello and welcome! My name is ***** ***** I am a licensed attorney and will try my best to help with your situation. There may be a slight delay in my responses as I research statutes or ordinances and type out an answer or reply, but rest assured, I am working on your question.

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How would MS law usually view this? eg attorneys fees of the beneficiaries and/or extraordinary "forensic" accounting fees. ?

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The trustee has a legal duty to provide an accounting at least once a year by law under the Uniform Trust Code unless the trust specifies more frequent reporting. Under the MS Trust Code it too requires an annual accounting. See MS Code 91-7-277

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So if the trustee refused to do so, they are in complete breach of their fiduciary duty to the trust and the beneficiaries and that would give the beneficiaries grounds to file suit against trustee for breach and seek to have him removed.

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The trustee has zero authority to charge the beneficiaries personally for doing their job. They are paid by the trust and only the trust and can use trust assets to pay for any accounting resources that may be necessary, like hiring an accountant.

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As for the applicable law, if the trust specified MS law, then that is a "choice of forum" clause and means that wherever the trustee is located, be it TX or MS or some other state, if the trustee is sued, the court has to apply MS law to the case.

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So if the trustee is in TX, the beneficiaries can sue him in TX, and the TX courts would apply MS law.

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thanks

Barrister