Duties Of Trustees In Washington State

A trustee is an individual or entity whose function is to administer the terms of a trust. This can involve acquiring, investing, reinvesting, exchanging, selling, transferring, controlling, dividing, and otherwise managing the trust’s property. The trustee often has a wide range of actions it can take in performing this function. But the trustee is held to a high standard of conduct or duty. The trustee’s duties and powers are determined by the terms of the trust, common law and statutes.

To whom does the trustee owe these duties? To the settlor (or creator) of the trust as well as to the trust’s beneficiaries. The trustee’s primary duty has been stated to be to carry out the trust settlor’s intent. However, courts have also said trustees owe the trust’s beneficiaries “the highest degree of good faith, loyalty and integrity.” In the state of Washington, by statute, the trustee “must administer the trust solely in the interests of the beneficiaries.” This means a number of things, including, but not limited to, informing the beneficiaries of all facts that would aid the beneficiaries in protecting their interests, reporting trust activity to the beneficiaries when required by the trust document or applicable law, not using trust assets to purchase assets for the trustee’s benefit, and not commingling the trustee’s assets with the trust’s assets. However, it does not mean the trustee is necessarily prohibited from engaging in transactions with the trust for the trustee’s personal interests. For example, the trust document may authorize particular types of transactions between the trustee on behalf of the trust and the trustee for the trustee’s personal interests; or such a transaction may be specifically approved by the court or in a nonjudicial binding agreement that complies with Washington statutes; or the trust’s beneficiaries may have consented to the trustee’s conduct, or ratified the transaction, or released the trustee in compliance with law. In any event, the trustee must act with care.

If you need assistance with trust-related issues, contact Per E. Oscarsson or one of the other attorneys in Beresford Booth’s Estate Planning and Probate Group.

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