Lawline CLE Webinar: Issues Affecting the Trust Fiduciary and Reasonable Compensation

Farrell Fritz partners, Ilene Sherwyn Cooper and Joseph La Ferlita, presented this 1.5 CLE credit Professional Practice webinar.

This course identifies some of the responsibilities of an executor and trustee and address the meaning of the term “reasonable compensation” when applied to the fees payable to the estate executor as discussed in case law as well as well-recognized treatises and commentary, and as viewed by New York courts, which have yet to definitively address the issue. The first part of the course explores some of these duties and areas of potential exposure, including (i) the fiduciary’s potential personal liability for the decedent’s/grantor’s unpaid taxes; (ii) conflicts of interest arising when the estate or trust owns an interest in a closely-held business; (iii) the trustee’s duty to keep beneficiaries informed about the trust’s existence and its administration; and (iv) requirements for investing estate and trust assets.

Too often, clients (and sometimes, their lawyers) accept appointment as executor or trustee without first considering the various duties associated with being a fiduciary, and without realizing the potential for personal liability. The second part of the course addresses these and related issues. Led by attorneys Ilene Cooper and Joseph La Ferlita, the program is designed to educate the estate practitioner and will serve as valuable instruction for draftspersons who are considering including a direction for reasonable compensation in testamentary documents, particularly in states where that term has not yet been clearly defined.

Learning Objectives: 

1. Identify areas of potential liability associated with the decedent’s/grantor’s unpaid tax debts and recognize the conflicts of interest that could exist when the estate or trust owns an interest in a business, particularly when the estate or trust owns a controlling interest
2. Appreciate the trustee’s duty to keep the beneficiaries appropriately informed about the existence of the trust and the basic aspects of its administration
3. Grasp the investment requirements imposed on executors and trustees, including the duty to diversify assets
4. Understand “reasonable compensation”
5. Identify issues one may encounter when including a direction for reasonable compensation in testamentary documents
6. Recognize the differences between the Federal treatises and state courts that have yet to address the issue definitively