Are you a beneficiary who is contemplating suing a trustee or a lawyer representing a beneficiary filing a suit against a trustee? If so, you need an expert team on your side to succeed in court, and a trust accountant should always be considered an essential part of your arsenal. Numbers don’t lie even if a trustee might, and a probate court accounting in California can be instrumental in defending your inheritance and preserving the integrity of the trust.
At Marcia L. Campbell CPA, we have helped countless beneficiaries identify signs of trustees abusing their station and provided expert testimony to bring these ill-intentioned individuals to justice in court. Here is a case study of a time we helped!
Probate Court Accounting in California Case Study
A law firm came to us representing the beneficiary of a trust, Mr. B. He had slowly realized that Mr. S, the trustee, was stealing from the trust and abusing his position. Mr. B then sued Mr. S for violating his fiduciary duty.
To succeed in court, the law firm filing the lawsuit knew they needed expert testimony to evaluate the trust accounting, assess account balances, and review other pertinent financial documents that would prove their case.
They came to Marcia L. Campbell CPA for probate court accounting in California and the expert testimony of a specialist trust accountant.
Mr. S was a long-time neighbor to the trust creator, Mr. B’s father. Mr. B’s father had tremendous confidence in his integrity and ability to administer the trust. When asked to be the trustee for this trust, Mr. S said he was “incredibly honored.”
Until Mr. B’s father passed away, neither Mr. B nor his father had any reason to suspect Mr. S would be untrustworthy. The trust held $2 million and a property valued at $750,000. Let’s explore how our expertise helped in court.
Related Article: How a Trust Accounting Can Uncover a Misappropriation of Funds
How Our Probate Court Accounting in California Helped Win This Case
At first, Mr. B was unconcerned with the way that Mr. S was managing and administering the trust. Mr. B was busy grieving his late father and placed a tremendous amount of faith in his father’s decision-making. Eventually, however, Mr. B started requesting a trust accounting.
While Mr. S never flat out refused to provide this information, he was evasive, and Mr. B had a sneaking suspicion things wouldn’t add up on the statement. This suspicion was only exacerbated when Mr. S suddenly began purchasing and wearing expensive, gaudy clothing.
Still, Mr. B wanted to honor his late father’s decision to have Mr. S administer the trust. But two incidents made it impossible to hold back his suspicion any longer. Mr. S had an adult child whom he was letting live in the trust property for $1,000 per month. Mr. B knew this was far below what they could charge someone to rent the property.
Mr. S also hired his brother’s contracting company to renovate and add to the property for a fee that was absurdly over the market price. When Mr. B confronted Mr. S about this, Mr. S said, “I’m the trustee, and I’m in charge of the trust. I’m allowed to invest in the property to fix it up so that we can sell it later, like the trust says.”
But Mr. B knew that these renovations were only for the benefit of Mr. S’s son, who was living in the house. Mr. B was beside himself. He contacted a trust litigation attorney and filed a suit after detailing the situation. Preparing for the case, Mr. B’s trust lawyer reached out to us to conduct a probate court accounting and review statements. We discovered:
- Unexplained withdrawals from the trust account of approximately $300,000.
- $800,000 paid to Mr. S’s brother’s company for renovations and additions; but the actual market value of the remodel was only $400,000
- A monthly loss on the property: Mr. S’s son was paying $3,000 per month less than the market value rent for the spacious property, resulting in a $36,000 loss over the year he lived there
We leveraged our resources and expertise to prove beyond a reasonable doubt that Mr. S was abusing his role, stealing from the trust, and operating with a conflict of interest, all of which resulted in a $736,000 loss for the trust and Mr. B.
“A trust accounting is the last line of defense for you to catch red flags that signal a breach of fiduciary duty, and it is also a crucial tool you can use in court to bring these reprehensible individuals to justice. Mr. B took action before irreversible damage occurred, and his attorneys reached out to professionals with financial acumen and court experience. Our testimony was essential to compelling the court to remove Mr. S from his station and order him to repay the trust.”
– Marcia L. Campbell, CPA & Trust Accountant
Related Article: Court Accounting vs. Trust Accounting
Do You Need an Expert Probate Court Accounting in California? Schedule a Consultation for an Advantage in the Courtroom!
As a beneficiary, you are entitled to the inheritance your loved one left behind, but some trustees will compromise it for their gain. Whether you need expert testimony to bring a trustee to justice or an expert eye to review a trust accounting prepared by a suspicious trustee, identify red flags, and confirm your suspicions, we can help.
A trust accountant is your greatest tool in defending and enforcing your beneficiary rights. Schedule a consultation for premier probate court accounting in California!
