Trust protectors are a rare breed in U.S. trusts. Our firm knows about using protectors because we do so much work with offshore (i.e., non-U.S.) trusts, where use of a protector is common. Case law from U.S. courts defining a protector’s rights and responsibilities are even rarer.
The Missouri Court of Appeals has a recent opinion involving a protector (warning: PDF). Cut to the chase — the Protector was a fiduciary, had an obligation to monitor the trustee’s (bad) behavior, and replace the trustee if necessary.
Memo to all personnel
Here are life’s lessons (re-learned) from this case:
Here’s my addendum to the life’s lessons learned: