Can you sue a trust?

The trustee can be sued when the fiduciary duty is breached. Generally speaking, this occurs if the trustee has taken any action that places himself or another person above the interest of the trust. The most common example of this is when the trustee participates in some kind of own negotiation. You can't usually sue a trust directly.

Again, this is because a trust is a legal entity, not a person. However, it is possible to sue the trustee of a trust, whether it is revocable or irrevocable. As mentioned, in the case of a creditor lawsuit, the trustee of a revocable living trust could be sued. If you appointed yourself a trustee of your revocable living trust, you could face a lawsuit for debt collection.

A living trust doesn't protect your assets from a lawsuit. Living trusts are revocable, meaning that you maintain control of the assets and that you are the legal owner until your death. Because you still legally own these assets, it is likely that someone who wins a verdict against you may have access to these assets. However, there are other options, specifically an irrevocable trust, to protect your assets from civil lawsuits.

You can start a court case involving fiduciary assets as you can with any other property. However, you can't sue a relationship like a trust. In casual language, people may refer to “the trust that has a lawyer means that the trustee has a lawyer, in the same way you can say, “Minnesota won the game to mean “A Minnesota team won the game. Technically speaking, however, a trust cannot have or do anything because a trust is not a “thing or person.” Can you sue directly to a trust Usually not, but you can sue the trustee of a trust.

You can also sue the beneficiaries of a trust. Your trust is a legal entity, and if you do something wrong, you can be sued. An example of this would be if your trust is involved in a transaction that goes wrong, for example, if the trustee uses money from the trust to buy real estate and the transaction has legal complications. Then, your trust or your trustee would be liable for the misdeeds and you could be sued.

If you transfer a car to a revocable living trust and cause an accident that results in the death or serious injury of another driver, the driver or your family could sue the trust for damages indirectly, suing you as a trustee. While you can't technically sue a family trust, you can sue the trustee of a family trust if you have a claim about the assets that trust owns, or if you think the trustee is mismanaging or stealing the trust. A family member who disagrees with what you place in your trust and the rules you set for the trust could sue in an attempt to modify or void the trust.

Katherine Moretto
Katherine Moretto

Avid pop culture nerd. Infuriatingly humble web guru. Certified food maven. General coffee fan. Passionate zombie enthusiast. Amateur baconaholic.

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