Can I File a Lawsuit Against a Living Trust if My Spouse Was Left Out?

By Teo Spengler

The person making a trust -- a legal vehicle to manage property -- transfers assets into it for her use during her lifetime. In the trust document she specifies beneficiaries, who are to benefit from the assets at her death. A disgruntled family member can challenge the trust, but only in special circumstances will a spouse have standing to do so.

Revocable Trust

A living trust is a legal document that creates a revocable trust to manage property. Generally, people making trusts name themselves both as the trustee, who manages the trust property, and as the beneficiary, who gets use of the property. The maker also names successor trustees to step in when the maker becomes incapacitated or dies, and successor beneficiaries to benefit from the trust property upon the maker's death. Living trust assets are not included in the probate estate but pass separately according to trust terms.

Standing to Sue

A living trust is not immune to suits from disgruntled heirs. A living trust can be challenged on many of the same grounds as a will, including fraud, incapacity and undue influence. If your spouse has evidence that he was left out of the living trust due to improper or illegal behavior, he could bring a suit. However, only the real party in interest has standing to sue. The spouse of a disgruntled heir generally won't have standing to sue in her husband's name unless she does so as his attorney or as attorney in fact of an incapacitated spouse.

Protect your loved ones. Start My Estate Plan

Sue the Trustee, Not the Trust

If you do have standing to sue, be careful who you name as defendant. Naming the living trust as a defendant in a lawsuit is a mistake you make only once, since this kind of suit goes nowhere. Rather than naming the trust as defendant, you must bring any suit involving trust property against the trustee, who is the legal representative of the trust. If you name the trust as the defendant, the fact that the trustee is also named as an individual defendant doesn't take care of the problem; you must name her as trust representative.

Considerations When Suing

Like wills, living trusts can and often do include "no-contest" clauses. A no-contest clause is language in a trust or will that nullifies a bequest if an heir contests the document, leaving him instead a nominal sum, like one dollar. If your spouse was not named as a beneficiary of some property but was named as a beneficiary of other property, he may lose his bequest by attempting to get more. If your spouse was entirely left out of the trust, he has nothing to fear from a no-contest clause by bringing suit.

Protect your loved ones. Start My Estate Plan
What Happens When a Living Trust Is Contested?

References

Resources

Related articles

Does a Trust Beneficiary Have Standing in a Suit to Determine a Trust Property?

All trusts have trustees and beneficiaries. A trustee's job is to manage, hold and distribute trust assets in favor of beneficiaries. Trustees have a legal right, called standing, to make decisions in lawsuits to determine, protect and oversee trust property interests. Generally, trustees, not beneficiaries, are the named plaintiffs or defendants in lawsuits for trusts. However, under certain circumstances, beneficiaries also have standing to directly participate in trust litigation.

Enforcing a Trust

A trust is a legal relationship in which a trustee holds property for beneficiaries, who are the individuals benefiting from the trust. The trustee must abide by the terms of the trust to manage property and distribute it to the beneficiaries. The person who creates a trust is known as the settlor, or grantor. The settlor can also serve as the trustee, naming a successor trustee who will take over for him following his death. Alternatively, the settlor can name someone else to serve as the trustee at the time he creates the trust. A trustee owes certain duties to the beneficiaries -- and the beneficiaries have a right to enforce the terms of the trust and hold the trustee in breach of his duties if he is performs any wrongful acts or omissions that affect their interests.

Can a Living Trust Be Disputed?

A living trust is an estate planning tool that allows a person's property to bypass probate court proceedings after death. At the same time, living trusts generally allow people to maintain full control over their assets during their lifetimes. Trusts are governed by state law and, like all legal documents, must comply with applicable statutes. A trust that does not conform with the law may be challenged in court and partially or completely invalidated.

LegalZoom. Legal help is here. Start Here. Wills. Trusts. Attorney help.

Related articles

What Is Diversion of Property From a Trust?

Diversion of trust property is a legal term used to describe the misapplication or misuse of trust property. Not only ...

Is a Living Trust Liable or Subject to Probate?

A living trust holds assets that are managed by a trustee for intended beneficiaries. Also called a revocable trust, it ...

How to Contest a Living Trust in Illinois

A living, or inter vivos, trust is created while the person donating trust property is alive. Trusts of this type are ...

Can a Revocable Trust Be Changed With a Will?

A revocable trust, or living trust, is an estate planning device that allows you to manage your property while you are ...

Browse by category
Ready to Begin? GET STARTED