A trustee in Minnesota has several important responsibilities that he or she must perform properly if he or she chooses to take on the management of a trust. Some residents of Saint Paul who have to deal with a trust personally may wonder exactly what these responsibilities are.
First off, people who are considering whether or not to accept an offer to be a “trustee” should remember that his or her responsibilities begin immediately and can last for a very long time. Unlike a personal representative, who steps in after a person’s death and manages the person’s property just long enough to carry the provisions of his or her will, a trustee will have to manage all of the property in a person’s trust until he or she is replaced or the trust ends by its own terms.
As has been discussed previously on this blog, a trustee must invest the trust funds “prudently” and must also use appropriate caution when distributing trust funds, even if the person receiving them is entitled to do so. Moreover, a trustee must pay all taxes due in a timely fashion and must otherwise make sure that the trust is current on its bills and in compliance with the law. Should a trustee fail in his or her duty to keep current on these obligations, he or she could wind up having to pay the bills of his or her personal funds.
A trustee also has an obligation to put the interest of the beneficiaries of the trust ahead of his or her interests in all cases and to communicate with the beneficiaries about the status of the trust. The trustee cannot play favorites with any one beneficiary or even appear to seek his or her own interest, even if there is no actual harm done.
Finally, the trustee agrees to sue and be sued as necessary to protect the property of the trust. Although a trustee usually won’t be expected to pay off any lawsuits or even to bankroll litigation, he or she will still have to invest both time and emotional capital into a potentially lengthy lawsuit.