Legal Question in Wills and Trusts in Arizona
Living Trust: potential liability for trustee
I am the trustee for my late father's living trust, a trust which no longer contains any assets because they were distributed after his death. I recently received an invoice for ''exploration and development'' from a petroleum company in which he owned (owns?) a small percent of an oilwell in Mississippi. I was unaware of this liability and want nothing to do with it. I now live in Arizona but the Trust was established in California. My question is: can the trust be sued/held liable for these costs and, more importantly, can I as the trustee be sued for this debt? Or am I protected individually? I am a teacher with limited means--certainly I'm no oil speculator--and this is causing my family a great deal of stress. Your help and advice would be greatly appreciated. Thank you.
1 Answer from Attorneys
Re: Living Trust: potential liability for trustee
If the trust was wound up and terminated, with all of the assets distributed to the beneficiaries, then your duties as trustee are terminated as well. Those who received the ownership interest in the oilwell, would be the ones responsible for the bill, and probably have no duty to pay upon forfeiture of their interest in the well. The trustee is not liable for the debts of the trust in any case, but the trustee may owe a fiduciary duty to creditors of the trust.
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