Abuse of Trust: Breach of Fiduciary Duty by a Trustee

Abuse of trust is considered a breach of the fiduciary duties owed by the trustee of a will or estate. When an individual decides how to distribute his or her estate among one or more beneficiaries, he or she will typically name a trustee who will be responsible for carrying out those wishes. A trustee may be a person or an organization and, in fact, can be anyone specified by the deceased, from a family member or friend to a lawyer to a financial investment company.

Depending on the size of the estate and the complexity of the deceased’s instructions, acting as a trustee can involve coordinating with multiple beneficiaries and being entrusted with distributing millions of dollars. Whenever there is a lot of money and someone in a position of trust, there is a potential for abuse. When a person in a position of trust, like a trustee, abuses that trust, it can be devastating for all involved.

If the trustee does not perform its duties in a careful and loyal manner as instructed, the trustee has engaged in an abuse of trust and breached its fiduciary duties. Because a trustee is expected to make judgment calls at times regarding the best disposition of the estate, it can be difficult to determine if an abuse of trust has taken place. This is where it can be useful to consult with an experienced breach of fiduciary duty attorney as not all breaches are cut and dried.

Although many courts and attorneys describe the fiduciary duties that a trustee owes to the beneficiaries in different terms, these fiduciary duties can generally be distilled into three main categories:

  • Duty of loyalty: requires a trustee to act solely in the interest of the beneficiaries.
  • Duty of care: requires a trustee to manage the estate in accordance with the trust guidelines and in compliance with applicable law.
  • Duty of impartiality: requires a trustee to treat all beneficiaries equally and prohibits favoring one beneficiary over the others.

Some common breaches of trust include intermingling of the trustee’s own assets with those of the estate. Another common breach of trust occurs when a trustee acts in a way designed to benefit the trustee personally, such as delaying distributing the trust’s assets to beneficiaries in order to collect additional management fees or borrowing from the trust. A trustee can also engage in a breach of trust by inaction such as failing to stop a co-trustee who has breached his or her fiduciary duty.

A beneficiary who suspects that a trustee has breached its fiduciary duties can file a breach of trust lawsuit against a trustee. If the court finds that a breach took place, the court has a number of common law and statutory remedies at its disposal. Section 1001 of the Illinois Trust Code provides a number of statutory remedies for a breach of trust including:

  • compelling the trustee to perform the trustee’s duties;
  • enjoining the trustee from committing a breach of trust;
  • compelling the trustee to redress a breach of trust by paying money, restoring property, or other means;
  • ordering a trustee to account;
  • appointing a special fiduciary to take possession of the trust property and administer the trust;
  • suspending the trustee;
  • removing the trustee;
  • reducing or denying compensation to the trustee; or
  • voiding an act of the trustee, imposing a lien or a constructive trust on trust property, or tracing trust property wrongfully disposed of and recovering the property or its proceeds.

If you are involved in an estate and believe that the trustee managing that estate has engaged in an abuse of trust, it is advisable to speak with an experienced breach of fiduciary duty lawyer as soon as possible. An attorney will be able to advise on legal options and what evidence will need to be gathered to hold a trustee accountable and stop further breaches of the trustee’s fiduciary duties from damaging the estate.

Our Chicago and Wheaton breach of fiduciary duty attorneys know how to prosecute and defend breach of trust claims and claims against executors or administrators of an estate. The attorneys at Lubin Austermuehle, P.C. have litigated breach of fiduciary duty, shareholder oppression, and business divorce lawsuits for more than three decades. Their diligence and success has not gone unnoticed with Super Lawyers naming attorneys Peter Lubin and Patrick Austermuehle a Super Lawyer and Rising Star respectively in the Categories of Business Litigation, Class Action, and Consumer Rights Litigation. If you’d like to discuss how the experienced Illinois breach of fiduciary duty attorneys at can help, please call us locally at 630-333-0333 or contact us online.

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