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My parents signed an irrevocable trust to be divided by the 4 of us after their deaths. Mom, who wanted us to share equally, has passed away. Dad, who wants EVERYTHING to go to his
"favorite", is alive. Because of constant arguing, a judge advised us to go through mediation and divide the trust now. Two of us say: divide the money equally by 5 so our father gets a share. Dad & his "favorite" say: each child gets 1/16 of the money and Dad needs the rest of it. Truth is...he's been living with a rich woman for 6 years and she pays for everything...trips, eating out, casinos, etc. Dad even brags about it. He saves his own
money. Dad & his "favorite" hope the lawyers believe their story so we only get a small amount of money, then Dad will give his large amount of money to his "favorite"! What can we do so the money is divided up more evenly?
Our incomes:
     1-bad health-income $30,000
     1-income $27,000
     favorite 1-income $60,000+
     1-income $60,000+

Optional Information:
Claremont, New Hampshire

Already Tried:
1-talking 2-court 3-lawyers...they don't seem to care if it's fair, and they're all hoping we don't settle so they can run the trust the way they want to

Customer (name blocked for privacy)

Hi and welcome,

Who are the trustees? Are there any income distributions provided for in the trust? Are there any provisions for periodic accountings? How did you come to go before the judge?

RL

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Reply to Richard V. Licata's Post: I was one of the trustees, my fathers
"favorite" is the other. My mother did not want my fathers "favorite" as a trustee because she's selfish, but he refused to sign the trust. We have to agree in order to do anything. Recently she wanted a blank check to do something that was expensive and I disagreed. I have always had to get written estimates to show her. She didn't like being told no, so she and her lawyer brought up a bunch of charges against me and had me temporarily removed...she gets to do what she wants. I can prove she's lying because I have several witnesses, but it will be an expensive court battle. The judge was told about all of the fighting and recommended the mediation. If we can't agree, a 3rd party will be appointed as trustee. But I know from other experiences that 3rd parties can mishandle your money.
While 1 or both of my parents are alive, they can ask for money if there is a need. We are supposed to use our common sense to decide if the need is real or not. (health, heat...yes, expensive gift for girlfriend...no.) My father has never asked for any money. The money doesn't have to be given out. Twice we have been allowed to take some money...the lawyer said it should be equal amounts and everyone should get some, not just 1 or 2 people. (One of my sisters asked for it, it isn't something we have to do.) New Hampshire just passed a law for yearly accounting, but since we were all at the meetings everyone knew every detail.

Hi and welcome,

I don't see any reason to divide the trust as described...(you did say one sixteenth (1/th) to each and dad gets the rest?). As I see it, Dad's not pressing for income distribution or invasion of corpus. Neither are the others. Let the favorite rant and rave. Just keep a low profile. Make your positions clear. It doesn't sound like there are so many decisions to be made that bring you and her together for discord. Worst case scenario...have a third trustee appointed to settle impasses. The cost of that shouldn't be a large expense. I wouldn't let her strong arm all of you into an early and inequitable distribution of corpus, and the yearly accountings keep everything out in the open.

Rich Licata

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Reply to Richard V. Licata's Post: None of us can afford to just sit it out...if we don't settle, it means there will be a $10,000.00+ court case. The judge also said none of us would be trustees, some lawyer or banker (chosen by him) would make all the decisions about our money...if they make bad investments, too bad. In the first part of my question I stated that my father was siding with his favorite...they both are saying that he now needs most of the money. He never asked for any in the past. The rest of us know from a life time of watching her get more and more that Dad will give her the money he gets. We are being offered crumbs and we have to agree or go to court, and then we will lose to some unknown trustee. Isn't there anything that protects the rest of us?

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Three of us will end up with 1/16th each. Dads "favorite" will get her 1/16th PLUS the 12/16th her father is claiming he needs. He doesn't need it, he's just saying that now so he can get it for his "pet".

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The mediation is on Tuesday Feb 20th. The problem is the huge sum of money that will only go to my fathers favorite, while the rest of us get crumbs. Two of us want to find a way to make this more equal for all of us. Dads pet is using him to get almost all of the money.

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If you can answer these questions it will help
us decide what to do and I'll stop pestering you:

I guess the part that really ticks me off is this: for years we have been told that this trust protected ALL of us. Along comes a spoiled brat who gets her father to lie, he helps her get 3/4 of the money and no one cares????? How are we protected?
   Or do lawyers only care about whats written on the paper...not what's going on with the people?
   (1) Is there any way to show the lawyers/mediator that the money will really go to Dads favorite? Or do they only care that it first goes to Dad? Any way to stop them?
   (2) Should the rest of us keep asking for an "equal 5 way split", or is it a waste of time?
   (3) Do mediators really try to help all sides, or will the mediator favor Dad over us?
   (4) In one of the ANSWER boxes above for
"Feb 17 at 1:19 am" Legal Eagle said my mother could give a maximum gift of 50% to her children and Dad was entitled to 50%. Is that a law or rule? Does that law have a title? or name? or number? I would like to know so we can mention it if we have to at mediation.
   (5) Does it matter when the money is divided if two of the children are doing well and two are struggling? (1 is a divorced single mom, 1 has had health problems for 2 1/2 years)
   (6) Dad has a lawyer and his "favorite" has a lawyer, so they will have 2 lawyers fighting for them (1 side). The rest of us can only afford one lawyer. Does that hurt us? Would a 2nd lawyer help protect us better? Or does the
mediator keep everything balanced?

Let me think about thse a minute. You're not pestering me. I'm here to help

Rich

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One clarification....is the trust corpus...whatever it contains...stocks, bonds, cash, real estate, etc...is it ready for distribution NOW...because your original question talked about distribution after THE DEATH OF MOM AND DAD?

Edited by Richard V. Licata on February 17 2007 at 5:55 PM

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I went back...it's clear there's no distribution until dad's death. The reason I asked it again was that I didn't understand why you keep talking about dividing the corpus NOW. I'll answer the questions.

1. If there is no termination of the trust then any income distribution IF IT IS ALLOWED IN THE TRUST INSTRUMENT or invasion of corpus IF IT ALLOWED IN THE TRUST INSTRUMENT...would have to be proven as DAD's need ONLY not favorite's. If you distribute...and dissolve the trust..not only do you get "crumbs", but you have no control over who dad gives his disproportionate share to.

2. If you are going to settle, you should settle for no less than what you would be entitled to if dad had just died. THERE IS NO REASON TO COMPROMISE.

3. A mediator should be just that...impartial. If he/she is truly showing PARTIALITY..move in court to have him removed.

4. I don't know what Legal Eagle was thinking. The trust instrument controls here.

5. NO. The trust instrument controls. If mom wanted your respective financial situations to be considered, she could have created trust language to accommodate that.

6. This is not a question the of side with the most lawyers wins. It is a function of the side with the best legal position (I think yours is solid). Then you need a tough lawyer who knows how to strategize, look the other side in the eye and MAKE THEM BLINK FIRST (sorry man..I'm a NYC trial lawyer!!!!).

Rich Licata

Edited by Richard V. Licata on February 17 2007 at 6:12 PM

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The trust says "after the deaths of our parents",
but because of the arguing the judge said to try mediation and thinking about ending the trust now. There is a house that is supposed to be in the process of being sold, everything else is ready to be sold.

I understand that....I don't care what the judge suggests. It's just a suggestion....and remember...the net result of the suggestion gets you crumbs. As I said before....your choice is clear. Hang in and insist the trust continue. If they litigate....call their bluff. You can always settle and terminate the trust and hopefully you will have upped the offer because you didn't cave in. OR DIVIDE THE TRUST WITH THE BEST DEAL YOU CAN NOW AND MOVE ON.

On a personal note.....I understand the emotions....but there's nothing you or I have added here.....you need to stop wringing your hands about it...take a position and stick with it....yes, a miracle could happen and your wicked sister could turn into the lovely princess if you wait one more day ...:-)....but it's unlikely.

Rich Licata

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THANKS for your help with all of my questions!
I had a good idea of what I wanted to do, but I felt like I was on shaky ground because no one would answer my questions and explain everything.
Now I'm sure of what I can do and I'll wait for them to blink!!
THANKS!

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