What is a Trust Protector and Do I Need to Name One in My Document?

What image comes to mind when you hear the term "Trust Protector"? A knight with a sword standing before a castle preparing to defend it? Or is it an image of a butler overseeing the work of the household staff? While the image of the knight is more exciting, a Trust Protector falls into the latter image. A Trust Protector is an individual or organization whose job it is to oversee certain decisions made by the Trustee. While a Trustee is given the authority to manage Trust assets on a day-to-day basis, a Trust Protector can oversee major decisions and have an annual review of the Trust, to ensure that the Trustee is performing his or her duties faithfully.

The following are some of the powers a Trust Protector may have the authority to do:

• Act as arbitrator between the Trustee and the beneficiaries;

• Remove and replace a Trustee;

• Approve Trustee compensation;

• Terminate the Trust; and

• Amend the Trust due to changes in the law.

While it is not required to have a Trust Protector, there are some cases when having a Trust Protector should be considered. For example, you may want a professional or corporate Trust Protector because you chose a family member to serve as a Trustee and are not quite sure that your chosen Trustee will be able to handle all of the decisions, or there is concern that the Trustee and the beneficiaries will not "get along." On the other hand, if there is a Professional or Corporate Trustee, you may want a family member as Trust Protector, because you want to ensure that the beneficiaries of the Trust have a family member looking out for their interests. You may also want to designate a Trust Protector in cases where there will be a long-term testamentary Trust or a Dynasty Trust (up to 150 years in WA State) and you are worried that trust laws could change during that time.

If you have questions about Trust Protectors or if you want to review your estate plan, please call Rehberg Law Group at 206.246.8772 to schedule an appointment with one of our attorneys.