....I'm confused. I thought one of the reasons for a trustee was to protect a recipient from making stupid mistakes with the money.....is this judge ignorant, does he have concerns about a legal challenge that would make him look bad?
Yes, imo, many, maybe virtually all judges have concerns about looking bad, often the result of being
reversed on appeal.
Yes, trustee
protecting a recipient from making stupid mistakes with the money" is often top reason for estab'ing fam trust.
IIUC, Sheila's bro is (
sole?) trustee & IIUC, is T'ee until HM is 30.
Presumably at that point, the trust corpus is distributed to her, but maybe not.
What does trust doc say about
distributions, if any, T'ee may make
to HM before age 30?
Poss, imo, that T'ee has duty to distrib to HM before age 30,
only income from the trust, no principal.
But also poss that trust terms allow T'ee to withdraw $ from trust principal to pay to HM, on a
discretionary basis.
Seems, imo, this is the case---T'ee has discretion to make payments or distributions to HM before age 30.
But T'ee is obligated to consider
other potential beneficiaries of the trust (assuming the trust doc specifies).
It's possible that HM could die - before or after birth of baby.
For ex, T'ee distributes all income and principal from the trust to HM to use for her legal defense,
and if the baby is born, will guardian bring suit on behalf of
baby against T'ee for breach of fiduciary duty?
Along the lines of -- despite trust terms allowing T'ee to make discretionary distributions. to HM, blah, blah,
clear that HM would have bn disqualified as a beneficiary under IL Slayer laws,
so T'ee never should have made distrib's to HM, and in doing so, T'ee breached fidu. duty, so is personally responsible,
so ct should order T'ee to personally repay the 1.5mil for baby.
Yes, idea of T'ee distrib'ing all of trust principal and income to pay for HM's defense is pretty faaaaaaaar out there.
But doesn't T'ee paying $150,000 for HM's defense carry that same risk, just involving less $.
And if trust provides Sheila's bro is a
contingent beneficiary, e.g., if, after S's death, HM died and left no offspring,
that compounds the difficulty, because it raises potential
conflict of interest to the equation, as in
'T'ee refuses to make distrib for HM's defense only because he wants the trust $ for himself.'
Who would want to be a trustee facing that dilemma??????????????????????????????????????? Or the judge?
I hope
pdf of trust and will surface.
ETA: Egg on my face again for not catching up & reading posts from earlier today.
So now, instead of Sheila's bro being faced w above decisions, at least on temp basis,
as
interim T'ee, Mackoffl faces them, presumably w. judicial oversight.
lease: