Can a Fiduciary delegate his discretionary power to another?

Robert Ray

A fiduciary owes the highest duty imposed in law to the person (beneficiary) over whose property he has control. A fiduciary might be appointed to administer a trust or handle an estate. The appointment will set out the rights and powers of the fiduciary. Based on these powers, the fiduciary will have the power to make decisions about the best use of the property. These discretionary powers may include the power to sell property, to invest, to rent or to exchange property.

Can a fiduciary delegate these discretionary powers? The general rule is that he can’t. 174/2 963. Usually when the trustee tries to delegate his powers, something bad is happening. For instance, an elderly trustee might be under the undue influence of someone who wants to use the trust property to benefit himself. Another example is where a person who doesn’t know the first thing about being a fiduciary relies on someone who takes advantage of the situation.

There are some cases where the courts have said that a trustee could delegate his discretionary duty. In a case where the trustee and beneficiary were the same person and this person and the trust, through the trustee, also were the guarantors on a note, the Supreme Court held that the beneficiary could not claim that the trustee had no right to delegate his duty to guarantee the note. 586/2 472. While this seems contrary to the general rule, when all the people involved are the same, you’re not going to avoid liability by claiming that you had no right to do what you did.

Copyright by Robert Ray a Texas inheritance attorney. The foregoing information is general in nature and does not apply to every fact situation. If you are concerned about inheritance laws, inheritance rights, have a family inheritance dispute, a property dispute or want information about contesting a will and need an inheritance lawyer, we can help. Please go to our main site and use the contact form to contact us today. We are Texas inheritance lawyers and would love to learn about your case and there is no fee for the initial consultation.


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The Author

Robert Ray

Robert Ray handles inheritance disputes of all kinds. He takes cases throughout Texas.
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