Are you starting to create your estate plan? If so, you’re likely to come across several terms that reference various roles associated with asset or trust management.
The term fiduciary refers to the relationship of trust placed in a person who is serving in a specific role. A fiduciary relationship is one responsible for managing the interests or the property of others.
There are several different examples of fiduciary relationships and this might come into context in your estate planning process. Examples of fiduciary relationships include those between an attorney and their client, an executor and the creditors or beneficiaries of an estate, the trustee and the beneficiaries of a trust, and members of the board of directors of a company and its stockholders.
The fiduciary relationship calls upon the fiduciary to hold an interest in property or the property itself for the benefit of beneficiaries. As a fiduciary a trustee and an executor both have a legal responsibility to be faithful and honest and act solely in the interests of the beneficiaries that they serve and no one else. This most frequently comes up when someone has been accused of violating their fiduciary relationship. This can lead to estate planning disputes.
To avoid these circumstances, make sure that you select the right person to serve in the role of executor or in any other fiduciary position in your estate plan. Doing this can greatly decrease the possibility of estate disputes in the future.
While there are rules and laws about what a fiduciary must do and beneficiaries can use these laws to hold such a person accountable, even trying to resolve those conflicts can expend energy, time, and money.
When you create a holistic estate plan, your estate planning lawyer helps you look at all the big picture and smaller details connected to what you want. Create an aligned estate plan now with the help of a lawyer. Contact our Pasadena law office for more help.