0

I am the trustee for a a special needs trust set up on behalf of a family member.

Historically, other family members have used deception or manipulation to get the beneficiary of the trust to release the assets of the trust for their own gain, potentially in breach of relevant law.

I have received a demand letter from a lawyer requesting information, claiming to be working on behalf of the beneficiary. However due to the previous actions of the other family members, I am suspicious of whether this lawyer truly does represent the beneficiary.

May I request a copy of an engagement letter, or some other document, proving to me this lawyer is working on behalf of the beneficiary and not the other family members?

  • Hi. Welcome to Law.SE. What jurisdiction are you in? – Paul Johnson May 25 at 9:55
  • 1
    USA, trust operates under Oregon law. – A Concerned Trustee May 26 at 2:21
3

First, agree w/Dale M re: it would be an egregious and likely career-ending move for an attorney to fake his representation. That said, there is likely no reason why you would be unable to request such proof of representation.

Your job consists of protecting the assets of the trust, carrying out any other duties outlined in the trust document, being honest and in communication with the trust's beneficiary, managing the assets, and ending the trust as determined by the trust document. Several of those points (particularly the "protecting the assets" part) argue heavily in favor of your confirming the veracity of any claims involving the trust and/or the identity or true intent of those seeking any information, etc., with respect to the trust.

Also, demand letters are letters stating a legal claim and usually asks for restitution or performance of an obligation. It's not entirely clear what constitutes a "demand letter requesting information" unless you have a legal duty to provide that information (and this would - or should - be stated in the demand letter itself).

Finally, should you be unable to obtain the confirmation you're seeking, you should consider consulting a trust administration attorney. In most cases, you may use trust assets to pay for expert help (including tax preparers and accountants).

2

First, if a lawyer say they represent X and they don’t they won’t be a lawyer for very long.

Second, even if they are working for X (which they almost certainly are), why do they (or X) have the right to receive information from the trustee beyond what the trust deed provides for?

2

It is easy to confirm (and you should confirm) that someone is a lawyer by checking the attorney registration data from the state where they purport to practice, usually available either online or with a quick phone call. If the person who claims to be a lawyer is not a lawyer then you are being defrauded.

If person claiming to be a lawyer is really a lawyer and says that they represent someone, you can generally trust that they are telling the truth about that representation. But, this doesn't mean that you can trust what the lawyer says about their client's rights to be accurate. You need your own lawyer to confirm that fact.

I have received a demand letter from a lawyer requesting information, claiming to be working on behalf of the beneficiary.

Usually a beneficiary of a trust is entitled to certain information about the trust (which varies based upon the trust instrument and the law of the state in question) even though they can almost never actually compel the trustee to take action on their behalf.

This is so a beneficiary can determine if funds are being embezzled or improperly invested in which case the beneficiary can petition to have a new trustee appointed and can sue the trustee for breach of fiduciary duty with the damages paid to and held in trust by a successor trustee.

Also the rights of a beneficiary are often different in the case of a special needs trust established with funds from a third party (weaker in those cases if the trust instrument so provides) than they are in the case of a self-settled or court established special needs trust. Sometimes a trust will give a "trust protector" the enforcement rights usually afforded to a beneficiary (e.g. when a beneficiary is a minor or incompetent or incapacitated).

Also, FWIW, usually both a state attorney general, and the court with probate jurisdiction in the state where the trust is administered, and sometimes also the relevant DA, also have general supervisory power to protect beneficiaries of trusts who can't look out for themselves which presumptively includes most special needs trusts.

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.