Courts appoint a representative to settle the estate when a person dies without a will. The estate is frozen until the probate process is complete. The representative is also known as the fiduciary, and they have a legal responsibility when they take on this role. Their role consists of gathering assets and debts, paying bills and taxes, and distributing remaining funds.
Fiduciaries are meant to prevent fraud and disputes, but what happens when they do not uphold their legal duties and instead have nefarious intentions? Speak with a Maryville probate dispute lawyer to discuss your options.
What are the fiduciary’s legal duties?
Maryville fiduciaries must act in the best interest of or benefit of another party. It is a high legal duty that is often seen in probate issues. Those in this role must act honestly in all legal dealings, and their role will depend on who they represent. A fiduciary can take on many functions depending on who they represent. They can represent businesses, estates, or individuals. A person who becomes a fiduciary has a lot of trust placed in them, and they must understand the legal ramifications of being a fiduciary and the possible consequence of a breach.
Duty of care
Two prominent breaches exist for these kinds of claims. A fiduciary has the duty to act prudently when making investments and by taking reasonable care and caution. When they breach these duties, it’s called a breach of duty of care. Most legal matters involve a breach of duty, whether personal injury, business, or probate law.
A fiduciary is liable for mistakes when pursuing the beneficiary’s interest when it involves intentional dishonesty or fraud. Fiduciaries to estates have the following responsibilities: if they do not meet them, they can be in breach.
- Avoid commingling personal and business funds with estate assets
- Handling debts owed by the estate appropriately
- Avoid misappropriation of entity assets, trusts, or estates
- Make prudent investments considering all beneficiaries now and in the future
- Account for assets
- Carry out the will or trust per the terms
They can also breach fiduciary duty if there is excessive spending, failure to disclose conflicts of interest, or waste of assets. Fiduciaries cannot be named in the will of the deceased.
Breach of contract versus breach of fiduciary
Although many people are under the impression that breach of fiduciary and breach of contract are separate claims, they intermingle. You will likely use a breach of contract claim to hold a negligent fiduciary responsibility for their actions. For a breach of contract claim, you must have a valid contract that contains an offer, acceptance, or other information. The contract must be in writing, and verbal agreements will not hold. Breaches occur when the fiduciary does not abide by the duties within the contract. You can obtain compensation in some breach of contract disputes depending on your circumstances and the breach’s severity.
You can remove a fiduciary upon finding a breach
If you work with a fiduciary and believe there was a breach, you can have them removed from your case. First, you must petition a Blount County court. The judge will review the reason for your request and can assign a new fiduciary and remove your current one. They can also take additional actions against the fiduciary. The following legal conditions must be present for a successful breach of fiduciary claim:
- Existence: there was a relationship between you and the other party. They also established a duty to you, such as a duty of full disclosure, a duty of fair dealing, or a duty of good faith.
- Breach: Once you establish duty, you must show there was a breach of the duty, such as misappropriation of funds, misuse of position, failure to disclose information, or neglect of responsibilities.
- Damages: Lastly, you must show you suffered damages from the breach of duty.
When you believe there is a breach of fiduciary duty, consult with a probate lawyer in Maryville immediately. Probate cases can be complex, emotional and contentious.
Legal deadline for breach of fiduciary claims in Tennessee
Breaches of fiduciary claims have a very short statute of limitations in Tennessee. You will only have one year to file for the removal of the current fiduciary and claim for damages. You must act quickly because these cases are very complex. Our attorneys must establish and prove the contract, relationship, breach, and damages. Before taking action on your own, speak with a Maryville probate lawyer because the fiduciary can reallocate funds and other assets if they suspect you are on to them. They can transfer all of the estate to someone else, making it harder to recover what you are entitled to.
You must have an experienced Maryville breach of fiduciary duty lawyer investigate and review your claim to ensure you are taking the appropriate legal steps. Fiduciary breaches are complicated, and you need proper representation to get justice and recover your losses. We understand it is challenging to trust an attorney if your fiduciary was a lawyer. Still, you must ensure you work with an attorney you trust and with experience handling these matters.
Estate planning is not an issue everyone thinks about, but you must. If you do not have a will or any instructions on how your estate will be disbursed, then you leave it up to the state. To prevent disputes and broken relationships, start your estate planning today. If your loved one has passed and you are being taken advantage of by the fiduciary, you have options. Contact our Maryville breach of fiduciary duty attorneys today. Shepherd & Long, P.C. is here to help you during this challenging time. Call our office or submit our contact form to schedule a consultation with a probate attorney today.