Is a Beneficiary Entitled to a Copy of the Trust from the Trustee in Nevada?
Many times I am asked by a child of someone who has died whether they are entitled to a copy of the parent’s trust. As you can imagine, the answer depends. There are various factors that come into play.
Generally speaking, after the grantor dies and as long as the person is a beneficiary of the trust, then yes, he or she may get a copy of the trust. But, just because someone is a child of the grantor does not entitle that person to a copy of the parent’s trust document.
One of the benefits of a trust is that it is more private than a last will and testament. If you rely on a will for your main estate planning document, then upon your death if a probate is needed, the will is filed with the probate court. It is now available for the world to see.
Filing a Last Will and Testament
Under Nevada law, a last will is to be filed with the clerk of the court within 30 days of someone’s death. Whoever is in possession of the will has this statutory obligation. NRS 136.050.
If the personal representative or other person who actually possesses the will fails to file it, he or she may be liable to liable to anyone interested in the will, eg. a beneficiary, for damages that the beneficiary may have incurred due to the neglect.
As mentioned, once filed with the court clerk, the will is a court record that is open to inspection by anyone.
Living Trusts Are Private, Usually
In contrast to a will, trusts generally remain private. Unless there is litigation, a trust is not filed or recorded anywhere.
And while the trustor is alive, other beneficiaries and heirs are not entitled to receive a copy of a trust and its amendments.
When you establish a revocable living trust, the drafting attorney should also prepare a last will and testament. However, this will is often referred to as a “pourover will”. It gets that name because the only beneficiary is the trust.
The pourover will is designed to act as a safety net to catch anything left outside the trust upon the grantor’s death and “pour” it into the trust.
Even if a disinherited child is able to view the pourover will, it does not really tell them much since it only lists the trust as the beneficiary. Such child still doesn’t know who the ultimate beneficiaries are.
A trust, on the other hand, is not required to be filed with the court. That is unless there is litigation over the trust. And even then there are procedures that may be used to keep the trust private by only having the judge view it.
Grantors are often under the mistaken belief that when they sign a trust, it is recorded or filed somewhere with the county or the state. This is not so. Even when real property is transferred to the trust, even though the name of the trust is on the deed, the trust itself is not filed or recorded.
When Must a Trustee Provide a Copy of the Trust to a Beneficiary
Beneficiaries may request a copy of the trust if they like. But a beneficiary of a trust must meet certain requirements before they can compel the trustee to provide a copy of it.
First of all, they have to be entitled to an accounting under Nevada state statute. While the grantor is still alive and the trust is revocable, no beneficiary other than the grantor is entitled to a copy. As a revocable trust, a competent grantor can amend it at any time.
But after the grantor dies, the revocable trust becomes irrevocable and a beneficiary may seek a copy.
However, even if the trust has become irrevocable, the trustee does not have to provide an accounting to a beneficiary if there is another beneficiary that holds a broad power of appointment over the trust. Only the power holder is entitled to an accounting, and thus, a copy of the trust.
Also, if a trust is subject to a power of appointment and a person has been effectively removed as a beneficiary by the power holder validly exercising the power of appointment, such person is not entitled to an accounting or copy of the trust.
And pursuant to Nevada statute, the trustee does not have to provide trust accountings to a beneficiary of an irrevocable trust if the beneficiary only has a discretionary interest.
So, whether or not a beneficiary is entitled to a copy of the trust is determined by looking at the status of the beneficiary, terms of the trust, and whether he or she could demand an accounting.
Even if a particular beneficiary or heir is not entitled to the trust document because the beneficiary is not otherwise entitled to an accounting or if the trust instrument states that the beneficiary is not entitled to a copy, there is still the court.
A court could order that the trustee provide a copy of the trust to a beneficiary if it deems necessary. Seeing at least a portion of the trust may be necessary to enforce the beneficiary’s rights under the trust. Or a copy may be important to help determine the adequacy of an accounting provided by the trustee.
Trust Document Provides Otherwise
A trust can be drafted so as to not allow a beneficiary to receive a copy of the trust. However, this may not be the most prudent idea.
Once the grantor is deceased and the trust is irrevocable, you generally want a beneficiary to be able to receive a copy of the trust in order for them to be able to enforce their rights under the trust.
However, perhaps allowing the trustee to redact those trust terms or portions of the dispositive provisions that do not apply to the beneficiary in question would be useful. That way a beneficiary doesn’t find out about other beneficiaries or what they are receiving.
Non Trust Beneficiaries Requesting Copies of the Trust
Very often a non-beneficiary is requesting a copy of the trust. This is usually a disinherited child. Even those that have had no contact with the grantor for many years will show up demanding to see the trust. They want to know what trust distributions they were left.
Such a person is not entitled to a copy of the trust, even if the person is a child of the grantor. The trustee is not required to provide the trust. And arguably, should not provide it.
Unfortunately, this can often lead to trust litigation when the non-beneficiary child is demanding a copy and isn’t getting it. The disgruntled, disinherited child files a petition to demand a copy.
In such a case, the trustee may respond by objecting to the petition and providing the court with a copy of trust to be viewed only by the judge. This is called an “in camera” review of the trust agreement.
Once the judge sees that the non-beneficiary is not named in the trust, the judge can let the petitioner know that they are not entitled to a copy and rule in the trustee’s favor.
As usual in legal matters, the rights of a person that thinks he or she is a beneficiary under a trust will depend upon the fact and circumstances.
If you are a beneficiary, you are most likely entitled to a copy of the trust. And even if you are not sure whether you are a beneficiary or not, it doesn’t hurt to request a copy. How else will you find out?
And if you are a trustee wondering whether certain named beneficiaries and heirs are entitled to receive to receive a copy of the terms of a trust, you should contact a trust attorney or law firm that specializes in trust administration.