Chapter 12 - The accounting
Independent trust accountant Susan Parker reconstructed six years.
Total Descendants Trust distributions:
$788,000.
Tyler received:
$612,400.
Direct educational/medical support for Emily? Some through Tyler. Counted as Tyler branch benefit.
Administrative expenses:
$175,600? Wait distributions total should be beneficiary only. Let's just beneficiary distributions $612,400 to Tyler. None to Hannah.
Could trustee have reasonably distributed nothing to Hannah if she never requested?
Possibly.
That became Janet’s defense.
“Hannah never asked.”
Hannah’s lawyer answered:
“She did not know the trust existed.”
Trustee knew.
Did a trustee have affirmative duty to notify a known beneficiary?
Generally yes, depending state/trust terms.
Likely.
Then Hannah’s circumstances.
She had:
Stable job as respiratory therapy manager.
Two children.
Mortgage.
No poverty.
No years of unpaid medical catastrophe.
She was not asking for charity.
That helped.
Then Tyler’s needs.
Some distributions supported:
Education.
Home.
Investment.
Not outrageous luxury.
Janet could argue she exercised discretion.
But impartiality requires consideration of Hannah too.
The accountant could not decide breach.
Just numbers.
Then trustee compensation.
Janet had paid herself:
$22,000 to $29,000 annually.
Total around:
$146,000 over six years.
Was that allowed?
Trust permitted reasonable trustee compensation.
Market comparison:
Potentially reasonable.
No fake fees.
Then company expense reimbursements.
Mostly legitimate.
No need turn Janet into embezzler.
The central breach remained exclusion.
Then one questionable item:
$48,000 legal fees from Descendants Trust used partly to defend Janet personally after Hannah’s claim.
Could trust pay trustee defense fees?
Potentially, if defending administration in good faith.
If breach found, some fees could be surcharged later.
Court reserved.
Then Hannah’s requested remedy.
Not:
Give me $306,200 because Tyler got $612,400.
Instead:
Determine what distributions she should reasonably have received if informed and considered.
Adjust future shares.
Surcharge Janet for losses caused by concealment.
Pay her legal fees as appropriate.
Then Tyler’s thirty-five thousand.
Susan Parker classified it separately:
Post-notice distribution.
Potentially subject to recapture or offset because Tyler knew dispute existed.
Tyler offered voluntarily:
Treat it as an advance against his future trust share.
No cash removal from Emily’s 529 unless court required.
Hannah agreed.
Janet objected strangely.
Why?
Because returning/offsetting it implied wrongdoing.
Tyler said:
“I’m not protecting the accounting anymore.”
That sentence came back to me.
He had spent years not understanding.
Then months protecting secrecy.
Now:
Open.
May you like
Still too late for easy trust.
But different.
