[WSBAPT] Testamentary Trust Asset subject to debt- estate's obligation?

[Marisa E. Broggel]

Dear Listmates,

 

I am struggling with a contested probate issue that involves a will with two
testamentary trusts.  The will states: Trust A contains a house, which was
solely owned by decedent, and where client (his daughter and her husband)
have lived for 19 years, with their four minor children.  The beneficiaries
of Trust A are daughter, her husband, and their four children, and each of
these people are named individually.  

Then, there is Trust B.  Trust B contains cash and a steady income stream,
and the beneficiaries are 1. Trust A; and 2. Decedent's other daughter.
(the other daughter is not the problem).  So, since Trust B benefits  Trust
A, that income is meant to pay for the mortgage and maintenance on the house
in Trust A.   

 

The issue I am dealing with is the residence- the PR is also the trustee,
and he has ignored the trust provision(s) and is letting the house be
foreclosed upon, basically.  Even though there is money in the estate that
the will states is supposed to pay the mortgage on the house.  He sued the
beneficiaries of Trust A for ejectment last year, and tried to sell the
house. (he didn't succeed on that, so is just waiting for trustee's sale).

 

Question:  If  an asset (like this house)  is willed to a trust or an
individual (and is there a difference?) and the asset (house) is  subject to
a debt secured by that asset, is it the estate' obligation to pay that debt
as a high priority application of estate proceeds, or does the asset pass
subject to that secured debt so that the beneficiary or trust must pay it?  

 

Also, is there any recourse for the clients (one of decedent's children, her
husband, and their four minor children, who have lived in this house for 19
years and who the decedent specifically provided for via this trust, so they
can keep living there)- when the PR/Trustee has intentionally failed to make
a house payment for 14 months?  

 

ANY help is greatly appreciated.  Thank you!!

 

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