A person or institution assumes a fiduciary duty when they act on behalf of another, putting the other’s interest above their own. When a probate judge appoints a personal representative to administer an estate after someone dies, that representative has a fiduciary duty to act in good faith, making these duties both legal and ethical.
People name executors in their wills because they trust them to ensure that beneficiaries receive their bequests and that creditors’ claims are satisfied. Executors are usually family members or friends, and the judge almost always honors the choice by officially naming them the personal representative.
Although an inexperienced representative can make some mistakes in administering an estate, a breach of fiduciary duty in Covina probate can be intentional, lead to civil action, and sometimes result in criminal charges. Call Amity Law Group today to speak with an experienced probate attorney about your situation.
Tasks a Personal Representative Assumes
Personal representatives identify, locate, value, and disburse assets the deceased names in a will or by other means if they die intestate, without one. The representative also sells assets as needed to satisfy creditors’ claims and pays final income and estate taxes if applicable.
Because representatives control the assets of others and cannot complain if they are mismanaged, the court retains some oversight to ensure the goals of probate are met. Those goals are met only if the representative treats beneficiaries fairly and is transparent about all material aspects of the process.
Representatives must make formal reports to the court regarding these assets. However, it is not uncommon for some of them to engage in self-dealing by being negligent or ignoring the best interests of the beneficiaries and the estate. Beneficiaries who suspect a personal representative is breaching a fiduciary duty or representatives who have been accused of self-dealing should contact a Covina probate lawyer now.
Ways a Fiduciary Duty is Breached
Self-dealing entails putting one’s interests above those of the estate and beneficiaries. Some ways this is done include the following:
- Embezzling funds from the estate
- Committing fraud
- Co-mingling estate money with personal funds
- Failing to follow a testator’s instructions provided in the will
- Failing to distribute assets as designated in the will or by statute if no will exists
There are other ways a personal representative can mismanage an estate. Still, if it is an honest mistake, a breach of fiduciary duty can be corrected or defended with the help of a Covina probate attorney.
Penalties for Breach of a Fiduciary Duty
Under the California Probate Code § 9601, a personal representative who breaches their fiduciary duty may have to pay the estate back for any loss or depreciation, with interest. If the representative makes a profit, the amount of profit with interest.
The representative could also be ordered to repay any profits that would have accrued to the estate had it not been mismanaged. In addition, according to California Probation Code § 8502, breaching the duty through tactics such as embezzlement means the court will remove the personal representative from the post. In rare cases, criminal charges could also be levied.
The court does have some discretion if the personal representative acted in good faith and reasonably but with limited knowledge, which causes a breach of fiduciary duty. It may choose not to reclaim all or part of the loss. Talk to a Covina probate lawyer who could guide you through the aftermath of a breach of fiduciary duty.
Call a Probate Attorney in Covina to Rectify Breach of Fiduciary Duty Accusations
Whether you suspect a personal representative in a probate case has an interest in mismanaging the estate or are at a loss when an interested party accuses you of it, we can help. Usually, a mistake is innocent and can be corrected with proper action.
Personal representatives must consider many legal and ethical aspects of filling positions, and consultation can give you the knowledge and confidence you need. Do not wait until the court reviews an accusation of breach of fiduciary duty in Covina probate. Call now to schedule a strategizing session with a skilled estate planning attorney.
