Too Many Eggs in the Trustee’s Basket

I recently worked on a piece of trust litigation where the deceased Grantor of a Trust restricted the ability of the Trustee to sell a leveraged asset that comprised > 95% of the Trust’s assets.  Regardless of the Grantor’s intentions, he did the Trustee no favors resulting, of course, in a lawsuit by one of the income beneficiaries.  Still, the Trustee had a duty to manage the asset in a way that complied with the Uniform Prudent Investor Act despite the restrictions.  This one was a lawsuit waiting to happen from day one.

Here is a good Barron’s article dealing with how a Trustee can manage concentrations of assets in a Trust, or how a Grantor can give the Trustee more flexibility.

Warning: Too Many Eggs in One Basket

About Steve Masterson

Court-appointed Trustee and Personal Representative, providing neutral, third-party, administration of Trusts and Estates; estate planning consultant to families, attorneys, and fiduciaries; and expert witness for trust and estate litigation matters. See my website at www.idahotrustee.com
This entry was posted in Duties of Trustee, Estate Planning, fiduciary, Investments, Prudent Investor Rule, Trust, Trust Administration and tagged , , , , , . Bookmark the permalink.

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