Legal Question in Wills and Trusts in California

I am the trustee for a complex living trust (father, the grantor has passed). Three beneficiaries; myself; brother, and sister. There is a house owned by the Living trust. My sister has a third party Special Needs Trust that was a part of the complex trust. I would prefer to NOT sell the house right now, but my brother wants his share now. Can I transfer money from the portion of trust that my sister and I have (equal to the monetary share of house's current market value) to my brother's trust share (and then distribute to him) so that myself and sister own the house, and he gets cash instead? Thereby, essentially buying him out of the house. Naturally, I will obtain an attorney to do so, but want to know if this is possible before I start seeking legal advice. Reminder is that I am both Trustee and one of the beneficiaries.


Asked on 6/03/10, 12:28 pm

1 Answer from Attorneys
Jonathan Reich De Castro, West, Chodorow, Glickfeld & Nass, Inc.

As long as everything is done above board and what you are proposing is not specifically barred by the trust document you can do what you are proposing. Most trust, for example, allow for non-pro-rata distributions, i.e. cash to one and the house to the other two. You need to be sure, of course, that you do everything correctly with regards to the Special Needs Trust. A lawyer will be essential to doing everything correctly. Please feel free to call us if we can be of assistance.

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Answered on 6/03/10, 3:55 pm


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