Can A Trustee Sue A Beneficiary For Harassment?

There has been a lot of literature regarding whether a beneficiary can sue a trustee, but little has been said about whether a trustee can sue a beneficiary, especially when the latter is engaged in harassment tactics towards the trustee?

Can a trustee sue a beneficiary for harassment? Sure. Anyone can sue anyone.

Will the trustee win and is this the proper legal remedy to take to stop the harassment are the more important questions.

What Amounts to Harassment

In New York, harassment is defined as a course of conduct that is intended to annoy, threaten, intimidate, or alarm another person and which causes a reasonable person to fear for their safety or that of their immediate family. Harassment can be civil or criminal.

A beneficiary engages in harmful harassing conduct toward the trustee when the beneficiary:

• Repeatedly follows the trustee in a public place or engages in conduct that would cause a reasonable person to fear for their safety;
• Makes repeated phone calls or sends unwanted text messages, emails, or social media messages that is intended to annoy or threaten the trustee;
• Uses threatening or abusive language toward the trustee in person or in written communication; or
• Makes false statements or spreads rumors about the trustee with the intent to harm the trustee’s reputation or cause emotional distress.

Sometimes, a beneficiary will refuse to sign a release for no apparent reason, delaying the trust administration and distribution. This, however, does not constitute harassment, as it is within the beneficiary’s legal right to refuse to sign a release.

Remedy

When a beneficiary engages in harmful conduct constituting harassment or other conduct that tends to delay trust administration and distribution, it is important to seek counsel from a trust litigation lawyer to know your remedies. Filing a harassment lawsuit may not be the best option.

It’s important to understand why the beneficiary is acting that way. A trust litigation lawyer will be able to represent you in talks with the beneficiary to avoid emotions and other unnecessary conversations taking place and to able to get to the root cause of the problem. Usually, it is just about money and the need for a proper trust accounting that a beneficiary will accept.

Trust Accounting

When a beneficiary refuses to accept an informal accounting or a partial distribution or to sign a release, getting a trust accounting lawyer that can prepare your accounting schedules properly is important to avoid any issues that may arise regarding improper recording or questionable expenses.

Trust accounting is a complex task that requires a review of all bank statements from the time the trust started and recording it in the proper schedule, whether it is principal, income, distribution, expense or commission.

A properly-made trust accounting will ensure that your informal account can withstand the scrutiny of court, if it has to come to that, because a beneficiary who does not accept the informal account will, sooner or later, petition the court for the trustee to settle the account judicially.

A beneficiary harassing the trustee can happen, but filing a civil or harassment suit against the beneficiary is usually not the best option. Understanding where the beneficiary is coming from and the reason for the beneficiary’s conduct will more likely lead to a resolution of the conflict than a civil or criminal lawsuit for harassment.

Having a trust accounting and litigation lawyer to represent you in your dealings with an unruly beneficiary can help immensely. Should you need assistance, we at the Law Offices of Albert Goodwin are here for you. We have offices in New York City, Brooklyn, NY and Queens, NY. You can call us at 212-233-1233 or send us an email at [email protected].

Why Most Trustee-Beneficiary Conflicts Are Avoidable

Many trustee-beneficiary conflicts result from communication breakdowns rather than fundamental disputes. Common patterns:

• Beneficiary feels uninformed. The trustee provides minimal updates, leaving the beneficiary uncertain about the trust's status. Frustration builds.
• Beneficiary suspects mismanagement. Without clear accounting, the beneficiary assumes the worst.
• Trustee defensive about questions. Beneficiary inquiries are treated as accusations rather than legitimate requests.
• Distribution delays unexplained. Beneficiaries waiting for distributions don't understand the reasons for delay.
• Family dynamics overlay trust matters. Pre-existing family conflicts get expressed through trust issues.

Proactive communication and transparency from the trustee often defuse these situations before they reach the harassment level.

Legitimate Beneficiary Inquiries vs. Harassment

A critical distinction is between legitimate beneficiary inquiries and actual harassment:

Legitimate inquiries include:

• Requests for periodic accountings.
• Questions about specific transactions in the accounting.
• Requests for copies of trust documents.
• Inquiries about the timing of expected distributions.
• Questions about the trustee's investment decisions.
• Requests for explanations of trust expenses.
• Concerns about specific actions that may breach fiduciary duties.

The trustee must respond to these inquiries in good faith. Refusing to communicate or treating these inquiries as harassment is itself a breach of fiduciary duty.

Actual harassment involves:

• Threats of physical harm to the trustee or family.
• Repeated contacts after the trustee has provided information and requested communication limits.
• Defamatory statements about the trustee to third parties.
• Surveillance or stalking.
• Showing up unannounced at the trustee's home or workplace.
• Contacts at unreasonable hours.
• Communications designed to harm the trustee's professional reputation without basis.

The Trustee's Documentation Strategy

When dealing with difficult beneficiaries, the trustee should document everything:

• Preserve all communications (emails, texts, voicemails).
• Keep detailed notes of phone conversations and meetings.
• Document the trust's compliance with required reporting.
• Maintain records of all investment decisions and the rationale.
• Document the trustee's responses to beneficiary inquiries.
• Preserve evidence of harassment if it does occur.

If matters proceed to litigation, this documentation becomes critical. The trustee who can show consistent good faith effort to communicate has a strong defensive position; the trustee who cannot is exposed.

Civil Harassment Causes of Action

If harassment is genuinely occurring, civil legal options include:

• Civil harassment lawsuit. Direct claim for damages caused by the harassing conduct.
• Intentional infliction of emotional distress. If conduct is extreme and outrageous.
• Defamation. If the beneficiary is making false statements harming the trustee's reputation.
• Tortious interference. If the beneficiary is interfering with the trustee's other relationships.
• Trespass. If the beneficiary is improperly entering the trustee's property.
• Restraining orders. Court orders limiting the beneficiary's conduct.

These claims have specific elements and requirements. Mere annoyance or disagreement does not support a claim; specific harmful conduct must be shown.

Restraining Orders

When harassment crosses into threats or repeated unwanted contacts, restraining orders can provide protection. Common types:

• Temporary restraining orders. Emergency orders issued quickly with limited initial showing.
• Preliminary injunctions. Longer-term orders issued after hearing.
• Permanent injunctions. Final orders following trial.
• Stay-away orders. Prohibiting the beneficiary from approaching specified locations.
• No-contact orders. Prohibiting communication directly or through third parties.

Violations of restraining orders can result in contempt sanctions, criminal charges, and substantial penalties.

Criminal Harassment

In severe cases, harassment may constitute criminal conduct. New York Penal Law § 240.26 and related statutes define criminal harassment. Reports to police can result in:

• Investigation and possible arrest.
• Criminal charges if evidence supports them.
• Orders of protection issued through criminal court.
• Potential incarceration if convicted.

The criminal process is typically reserved for serious conduct involving threats, repeated unwanted contacts after warnings, or other behavior crossing the criminal threshold.

Petitioning to Compel a Release

When a beneficiary refuses to sign a release after receiving distributions or after the trust matters have been resolved, the trustee can petition the court to compel the release or to obtain equivalent protection. The court may:

• Order the beneficiary to sign a release if their objections lack merit.
• Conduct a formal accounting proceeding that resolves the trustee's exposure.
• Issue a judicial decree settling the account.
• Award costs against the beneficiary if their refusal was unreasonable.

The judicial accounting provides the trustee with court protection equivalent to a beneficiary's release. This is often the better path than fighting about whether the beneficiary will sign.

When to Resign

In extreme cases of trustee-beneficiary conflict, resignation may be the best option:

• If the conflict is making effective administration impossible.
• If the trustee's mental health or family life is being affected.
• If the cost of defending against harassment is exceeding the trustee's compensation.
• If a successor trustee can administer the trust more effectively.

Resignation must follow the trust's procedures and typically requires a successor trustee to be in place. A trustee cannot simply walk away from fiduciary obligations — the resignation must transfer responsibilities properly to a successor.