Trustees are personally liable for which of the following?

Prepare for the ATT Law Exam. Practice with multiple choice questions, each providing hints and explanations. Be well-prepared for exam day!

Multiple Choice

Trustees are personally liable for which of the following?

Trustees become personally liable when their breach of duty or negligent handling causes a loss to the trust. The key idea is that liability attaches to damages suffered by the trust itself, not to the profits of beneficiaries or to the beneficiaries’ own debts or assets. So the trustees’ personal responsibility is to make good the losses the trust experiences due to mismanagement or failure to act in accordance with their duties. The profits earned by beneficiaries belong to the beneficiaries and are not a loss borne by the trust, the debts of beneficiaries are their own obligations and not typically the trustees’ liability, and the personal assets of beneficiaries are separate from the trust and not at risk due to the trustees’ conduct unless a breach directly affects trust assets.

Trustees become personally liable when their breach of duty or negligent handling causes a loss to the trust. The key idea is that liability attaches to damages suffered by the trust itself, not to the profits of beneficiaries or to the beneficiaries’ own debts or assets. So the trustees’ personal responsibility is to make good the losses the trust experiences due to mismanagement or failure to act in accordance with their duties. The profits earned by beneficiaries belong to the beneficiaries and are not a loss borne by the trust, the debts of beneficiaries are their own obligations and not typically the trustees’ liability, and the personal assets of beneficiaries are separate from the trust and not at risk due to the trustees’ conduct unless a breach directly affects trust assets.

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