Q: Is there a conflict of interest when a lawyer supports beneficiaries' efforts to dissolve his clients' irrevocable trust
In 1998, he created a QPRT for them, which owns their home. Their three adult children are beneficiaries. Two of the beneficiaries don't like the idea of inheriting a house without a step-up in basis. The lawyer wrote to the third, who is the successor trustee, to tell her that, and also that, if all beneficiaries agree, the trust can be dissolved. Would she agree? But the trust also states that the home cannot be sold while any trustor is alive. The trustee believes her brother, with power of attorney already in hand, would sell the house and move the trustors into some other kind of housing, over-riding their lifelong plans, to wash his hands of hassles. (HA!) She plans to buy her siblings out, not sell. In June, the lawyer helped transfer a RE asset of his clients' revocable trust, worth $250K, to the brother, harming the other two beneficiaries of that trust and also his clients (of diminished capacity), as their investments are almost gone and a steep decline in income looms.
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