Can a Sibling Serve as a Trustee in New Jersey?
A trust can be an efficient, effective estate planning tool. A trustee is the person (or entity) who is tasked with overseeing the trust. Notably, a non-professional individual can serve as a trustee. A family member, including a sibling, may be a sensible choice for a trustee. In this article, our New Jersey trust planning attorney explains the key things to know about a sibling serving as a trustee.
New Jersey Law Allows a Sibling to Serve as Trustee
New Jersey law generally allows a competent adult to serve as trustee. A sibling can be named as trustee in a revocable living trust, testamentary trust, special needs trust, or another trust instrument if the person creating the trust believes that sibling is the right choice. Many people choose a sibling because that person understands the family, knows the beneficiaries, and may be more willing to serve without the formality or cost of a corporate fiduciary. Still, legal authority is only the first question. Practical needs matter.
A Sibling Trustee Must Follow Fiduciary Duties
A trustee in New Jersey owes fiduciary duties to the beneficiaries. Under the New Jersey Uniform Trust Code, a trustee must administer the trust with loyalty and in the best interests of the beneficiaries. The trustee must follow the trust document, protect trust property, avoid improper conflicts of interest, keep appropriate records, and act prudently when managing assets.
To be clear, the duties apply even when the trustee is a brother or sister. Family status does not soften the legal standard. A sibling trustee cannot treat trust property as personal property. They cannot favor themselves, delay distributions for personal reasons, ignore beneficiary questions, or use trust assets to settle old family grievances.
Family Dynamics Can Make or Break the Appointment
A sibling may be the best trustee when the family relationship is stable and the trust terms are straightforward. For example, if all beneficiaries trust the same sibling, the assets are simple, and the distribution plan is clear, a family trustee can help keep administration personal and efficient. The trustee may know how to handle the parents’ home, sentimental items, or a beneficiary who needs careful support.
The same appointment can backfire when siblings already distrust each other. If one sibling serves as trustee and the others are beneficiaries, every decision may feel personal. A delayed distribution may look like punishment. A request for documents may feel like an accusation. A disagreement over selling the family home can turn into litigation. The person creating the trust should think honestly about those dynamics before naming a sibling. A neutral trustee, co-trustee, trust protector, or professional fiduciary may reduce the risk when the family has a history of conflict.
Call Our New Jersey Trust Planning Lawyer Today
At Poulos LoPiccolo PC, our New Jersey trust planning attorney is a compassionate, experienced advocate for clients. If you have any questions about a sibling serving as a trustee, we can help. Please do not hesitate to contact us today for a strictly confidential initial consultation. Our firm provides trust planning services statewide in New Jersey.
