While estate planning and thinking about what to do with your assets and estate is not the most pleasant situation, it is nonetheless a necessary one.
If you do not make your wishes clear and do not establish parameters for how you want your estate to be handled, others will have no choice but to decide for you.
When you create an estate plan, you are deciding how you want to distribute your wealth and what your preferences are regarding your health in the event of incapacitation and after death.
You are also deciding who will be the fiduciary, the individual in charge of making decisions and distributing assets.
These people, whether they are an executor, trustees or guardians, are appointed to ensure your wishes are followed and executed according to your will and instructions.
Unfortunately, in rare cases, a fiduciary breaches their legal duty to act in the interests of the estate’s beneficiaries, which can cause serious harm for both the fiduciary and the beneficiaries.
Understanding breaches of fiduciary duty
Fiduciaries have a legal obligation to act diligently, honestly and in the best interests of the beneficiaries.
What is a breach of fiduciary duty in estate planning?
A breach of fiduciary duty in estate planning happens when the fiduciary does something contrary to the wishes of the individual who created the estate or fails to act accordingly. Fiduciaries have a legal responsibility toward the beneficiaries.
Fiduciaries must avoid conflicts of interest and prioritize the beneficiaries’ interests over their own.
Negligence or Mismanagement
Fiduciaries must exercise reasonable care and prudence in managing and preserving the estate’s assets.
Failure to follow instructions
Fiduciaries must follow the instructions outlined in the estate plan.
Safeguarding your interests
To protect your interests and minimize the risk of a breach of fiduciary duty:
- Carefully choose your fiduciaries
- Ensure clear communication between you, the fiduciaries and the beneficiaries.
- Periodically review and update your estate plan to reflect changes in circumstances or desires.
A breach of fiduciary duty disrupts the intended distribution of assets. It can cause significant harm to the beneficiaries. It is a serious offense that can carry severe consequences.
Understanding and taking proactive steps to safeguard your interests can help protect and protect your estate plan.