Going to court is an expensive proposition in almost all situations because of attorney fees and court costs. Court is also often time-consuming as reflected in the adage “Justice grinds slowly”. Probate Court is no exception. One of the main advantages of creating a revocable living trust during your lifetime is to avoid probate when you die.
When one dies with a revocable living trust that has been properly funded, the probate process can be avoided. Normally, a court is never involved with the supervision of a revocable trust when the creator of the trust dies. However, there may be times when a court will become involved in a trust administration (i.e. there is a dispute among the parties, the trust agreement is ambiguous, the trustee is acting improperly, et cetera). If there is a possible disagreement on a trustee’s desired course of action, is it always necessary to go to court even though you would like to avoid the cost of doing so? The answer is no.
A possible alternative is a Notice of Proposed Action. Under Nevada law, a trustee can mail out a written Notice of Proposed Action to certain prescribed adult beneficiaries of the trust. The Notice must state certain things, including but not limited to a description of the proposed action, an explanation of the reason for taking the action, and the time within which objection to the proposed action may be made. The time provided for objecting cannot be less than 30 days after the notice of proposed action is mailed to the beneficiaries. A beneficiary may object to the proposed action by mailing a written objection to the trustee within the time stated in the notice. If no beneficiary timely objects to the proposed action, the trustee can proceed with the proposed action and is not liable to any present or future beneficiaries with respect to that proposed action. Accordingly, the mailing of a Notice of Proposed Action by a trustee is usually far preferable than immediately going to court to have a disagreement settled by the court. If no timely objection is made to the Notice of Proposed Action, the dispute over the proposed action has been settled without incurring the court costs and attorneys fee of going to court.
- Attorney John Mugan