What Happened
When parents leave behind significant real estate or business holdings, even the best intentions can create unintended challenges for the next generation. In this case, a family trust built over many years through an enterprise that acquired and managed multiple investment properties became the center of a legal dispute among siblings.
After the parents’ passing, one of the siblings chosen by the parents — who had helped manage the family business for several years — stepped into the role of trustee and began managing the trust’s assets, including several LLCs that held various rental properties.
The trust contemplated that the siblings would remain tied together indefinitely as the trustee managed the assets to generate income for all of them. However, longstanding issues among the siblings, combined with informal recordkeeping and incomplete administration by the new trustee, led the non-trustee beneficiaries to allege mismanagement and file a petition to remove the trustee.
With the siblings financially and emotionally entangled in a trust structure that bound them together indefinitely, what was once a symbol of their parents’ success and unity had become a source of tension and division. The trustee sibling turned to Keystone for help in enforcing his rights as trustee, defending against the petition, restoring order and resolving the growing trust dispute without sacrificing the value their parents had worked a lifetime to build.
How Keystone Was Able to Help
First, Keystone’s team immediately intervened to stabilize the trust administration. Our attorneys conducted a thorough review of the trust’s records, ensured acceptable trust accounting information was prepared, and provided all trust beneficiaries with the information and transparency to which they were entitled.
Once the administrative issues were resolved, the focus shifted to crafting practical solutions to the non-trustees’ claims against the trustee and to devising a strategy to separate the parties, despite the trust’s contemplation that they would remain tied together indefinitely.
Keystone’s trust litigation attorneys guided the parties through a series of focused partial settlements, each addressing discrete disputes and resolving what could be resolved at that time, while building momentum toward a comprehensive resolution. This methodical approach created space for cooperation and reduced hostilities over time.
Ultimately, Keystone’s strategy resulted in a final, global settlement that provided for an equitable buyout of the non-trustee siblings while preserving the majority of the family’s hard-earned assets, allowing the sibling who had built the business into the centerpiece of his career to continue its operation.
By combining meticulous administration with creative negotiation and a step-by-step approach to resolving disputes, Keystone transformed years of conflict into a lasting resolution. The outcome allowed all parties to receive an acceptable inheritance from their parents while positioning Keystone’s client to continue running the family business independently.
