In 2003 mom and dad sold their property (residential and commercial) and they set up a family trust. The trust held the mortgage for the pro...

Question

In 2003 mom and dad sold their property (residential and commercial) and they set up a family trust. The trust held the mortgage for the property. The buyer defaulted on the mortgage and the trust took back the property. There are 3 trustees, all daughters. One of the trustees has done many illegal things (ie insisting on renting the property instead of reselling, tying the tenant into a three year lease for $1200, commingling trust money with her own money and the list goes on. Now this trustee has manipulated our 85 yr old mother into believing only what she is telling her and has convinced mon into contesting the trust and saying she wants her property back. She will then give it only to that daughter and that trustees son and excluding her other two daughters and other two grandchildren. What are her chances after 9 years to get her property back? The trust states that 2 trustees are needed to bind the trust and we have already resold the property to the tenant that had the 3 year lease.

Answer

First, I would have to see the Trust to comment on it, but if it is in an irrevocable trust at this stage due to your father's death, then it cannot be dissolved unless there is a provision that allows your mother to do that.

Second, The three trustees should demand an accounting and require all payments be made to the Trust bank accounts and that the trust bank accounts should require two signatures on all checks.

Third, I would take a copy of the Trust and all your information to an attorney as soon as possible so your third sister can be stopped from trying to break the Trust as soon as possible.

I would strongly suggest you get ahead of this, assuming that there are real assets in this trust.