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Challenging Revocable Living Trusts

The time limitation for challenging a revocable living trust is generally two (2) years after the settlor’s (i.e., trust creator) death. This two year period can be shortened in at least a couple of different circumstances, such as if the successor trustee sends a notice to all beneficiaries accelerating the time period to six (6) months. See Section 456.6-604.1(2), RSMo. 

Practically, however, assuming the decision has been made to challenge the trust, it generally makes sense to do so as soon as possible. Evidence and memory can go stale as time passes and it is typically advisable to avoid any arguments that your suit is untimely. More pertinently, a successor trustee has an obligation to expeditiously administer and distribute the trust property. You want to avoid the situation in which you sue to set aside a trust but the trust assets have already been distributed to beneficiaries, etc. Missouri law specifically contemplates this scenairio and requires that a “beneficiary of a trust that is determined to have been invalid is liable to return any distribution received.” Section 456.6-604.4, RSMo. While this provides a legal path toward “clawing back” any distributions made under an invalid trust, it can be practically difficult or impossible to collect against the beneficiaries (e.g., they have spent the money, etc.). 

To avoid this problem, it may be appropriate to send a notice of the trust contest to the trustee. A trustee is liable for making distributions to beneficiaries if the (1) trustee knows of a pending judicial proceeding contesting the validity of the trust or (2) a potential contestant has notified the trustee of a possible judicial proceeding contesting the trust and the contest is commenced within sixty (60) days after the notice is sent). Section 456.6-604.3, RSMo. Sending the notice articulated in the foregoing sub-seciton (2) often has the effect of “freezing” the trust assets from beneficiary distributions because a trustee is almost always going to be unwilling to expose himself, herself or itself to personal liability. 

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