Q: Are expenses made to repair trust properties, made at the trustees expense?

A: I am sorry to hear you are in this situation. Many trustees are left in untenable financial situations without clear options, and you are not the first successor trustee to consider using their own funds to cover trust expenses.

The trusts expenses are absolutely not your personal responsibility. You have a legal duty to manage the trust in a responsible and professional matter, but that does not extend to making personal financial contributions. Nevertheless, I can understand the instinct to try to support the trust and reduce conflict with the beneficiaries.

If the trust does not direct you to continue to manage the properties as trust assets, you should consider making final distribution of the properties to each of the beneficiaries. That way, all of the beneficiaries will be co-owners, with an equal obligation to care for the property. Alternatively, the beneficiaries can agree to distribute to the properties to an LLC with a professional manager.

As far as liquidity, you may consider seeking financing against the trust properties. That may reduce the amount of income available to the beneficiaries, but if financing is available with reasonable effort, you are more likely to have a duty to pursue that financing as opposed to making your own personal contribution.

A: Trust funds should typically cover necessary repairs to trust properties, especially when the trust document explicitly authorizes using trust assets for "ordinary and extraordinary repairs." Your attorney's initial advice to make repairs using trust funds aligns with common trust administration practices, particularly for rental properties that generate income for the trust.

If the trust document states you can use trust funds for repairs, this suggests these expenses should be covered by the trust, not your personal funds. The attorney's recent statement contradicting their earlier advice and the trust document's language raises concerns. You might want to seek another legal opinion, as this interpretation could unfairly burden you with expenses that should be trust obligations.

Consider gathering documentation of all repairs, the attorney's initial advice, and relevant sections of the trust document. Since the properties will ultimately become yours, reasonable repairs benefit both you and the other beneficiaries by maintaining the properties' value during the trust administration period. You might want to discuss this situation with the other beneficiaries and potentially reach an agreement about handling these expenses before final distribution.