Trusts and Estates
Ca. Trs. & Estates Quarterly 2021, Volume 27, Issue 1
Content
- 2020 Legislation: a Short Legislative Session With Surprises
- Advanced Planning - a Decade In Review: What Have We Learned Over the Last Decade and Where Are We Headed?
- Chairs of Section Subcommittees
- Editorial Board
- From the Chair
- From the Editor-in-chief
- Inside this Issue:
- Litigation Alert
- Tax Alert
- Tips of the Trade: the Irs Will Get Its Money, Just Not From Your Client-fiduciary
- When Is Enough, Enough? Judicial Trustee Removal and Trolan V. Trolan (2019) 31 Cal.App.5Th 939
- How Much Is Too Much? Trustee Compensation and An Analysis of California Rules of Court, Rule 7.776
HOW MUCH IS TOO MUCH? TRUSTEE COMPENSATION AND AN ANALYSIS OF CALIFORNIA RULES OF COURT, RULE 7.776
By Joshua S. Yager, Esq.* and Peter S. Myers, Esq.**
MCLE Article
I. THE VIGNETTE
When reading a trust document for the first time, a new trustee discovers that the trustee’s compensation shall be "a reasonable amount under the circumstances." The trustee calls the CPA who prepared the income tax returns for the prior trustee and asks, "What is a reasonable amount to be compensated as trustee?" The CPA responds, "$120 per hour. That’s what your time is worth, and that’s what the prior trustee was paid." Unsatisfied with that answer the trustee calls the attorney who drafted the trust and asks, "What is a reasonable amount to be compensated as trustee?" The attorney says, "A fixed annual amount based on the time spent administering the trust and the size of the trust." Unsatisfied with that answer, the trustee calls the bank that holds the trust assets and asks a banker the same question. The banker responds, "One percent of the value of the trust assets is the custom in the community."