Milpitas, CA estates & probate attorney Elijah Keyes discusses the duties a fiduciary has to their beneficiaries. He explains that a trustee serves as a fiduciary, meaning they hold the responsibility of managing the assets or decisions of another person. A fiduciary duty arises from this responsibility and requires the trustee to act in accordance with the trust’s terms and in the best interest of the beneficiaries. While there are numerous fiduciary duties, he highlights the three most significant.

The first is the duty of loyalty. A trustee must act solely for the benefit of the beneficiaries, not for personal gain. This can present challenges in cases where the trustee is also a beneficiary, such as when one of four siblings serves as trustee. In those situations, the trustee must ensure decisions are made fairly for all beneficiaries, not just for themselves.

The second is the duty to avoid commingling assets. Trustees must not mix trust property with their personal property, except in the rarest of emergencies. He notes that trustees often make the mistake of placing trust assets in their own name, unaware that doing so violates their obligations.

The third, and perhaps most critical, is the duty to follow the trust document. A trustee is bound by the written terms of the trust and cannot substitute informal verbal instructions, even if those instructions came directly from the trust’s creator. For example, if a parent made a request on their deathbed, those words do not override the formal document unless all beneficiaries agree to honor them. As he emphasizes, “the document is king,” and the trustee’s duty is to administer the trust according to its written terms.