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What are a fiduciary's responsibilities?

There are many types of professionals that are considered to be fiduciaries, including attorneys, real estate agents or brokers, accountants, business advisers, bankers and financial advisers. Then there are others such as trustees and executors that don't necessarily have to be trained professionals like the others described above. They can be asked to assume fiduciary duties for another person. There are lots of responsibilities associated with acting as a fiduciary for someone else.

Fiduciaries have a legal obligation to be both trustworthy and honest in representing someone. Any number of individuals described above can be brought in to serve as fiduciaries either before or after a person's death. The person acting as a fiduciary must act in the best interest of the individual they're representing.

A testator, or the person who drafts a will, is generally tasked with appointing an executor or personal representative to administer their estate. That person is essentially their fiduciary. It's their responsibility to handle the testator's estate per their wishes. If a person dies intestate (without a will), then a Houston probate judge will generally appoint someone to serve as the executor of their estate. That person would become a fiduciary if they accepted such a role.

Trustees are responsible for administering the assets that have been placed in a living trust. Its grantor generally drafts a trust agreement documenting how their assets should be managed. If it's an irrevocable living trust that's involved, then the trustee generally administers it from the moment that it's set up.

Individuals who have a revocable living trust generally appoint a trustee and a successor to administer their trust. They can step in and manage it if the grantor were to become incapacitated or die. In all of these instances, the trustee assumes fiduciary responsibilities.

The role of a fiduciary should not be taken lightly. A violation of trust is a breach of fiduciary duty. Such actions can cause someone to lose their Texas professional license and to be held criminally or civilly liable for their indiscretions.

This is why you may find it in your best interest to consult with a trustees, executors and fiduciaries attorney here in Houston if you're considering taking on such a role. Your lawyer can make sure that you fully comprehend to what you're agreeing so that you don't unintentionally expose yourself to any legal liability.

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