Can I Evict Wife of Trust Beneficiary from House in Trust?

 In Irrevocable Trusts
trust beneficiary in house

Photo by Phil Hearing on Unsplash

Question:

I am trustee for my brother’s trust. He lives in my deceased parents’ home with his wife for $1/year. I had them sign a lease so I could get the proper type of insurance in case my brother or his wife ever made a claim against the trust such as a slip and fall. The house is owned 50/50 by his trust and my trust. I have allowed him to stay and not sold the house because he does not have the means to rent or buy his own place. I distribute 3% of trust to him every year and have discretion to distribute more if I want. The remainder beneficiaries of his trust are my children and he does not have a power of appointment to leave anything to his wife when he dies. The lease renews each February. I would like to terminate the lease with the wife since she has caused me nothing but aggravation, constantly demanding upgrades to the house. I have authorized repairs when needed such as a new furnace, new roof, new appliances, etc. Last month she called the city housing inspector (first time she did that) complaining that she wants new windows and a new bathroom. The inspector cited me for some minor items which are being repaired by a handyman. If I terminate the lease with the wife but allow my brother to stay if he wants, will she have any legal standing to remain since she is his wife?

Response:

To answer your landlord-tenant question, generally close family members of tenants can continue to live with them. You cannot allow your brother to remain and not his wife except in extreme circumstances. Landlords can seek court action to bar the presence of family members of tenants in extreme circumstances, usually requiring a showing that they are dangerous to others or the premises or that they are using the property to engage in criminal activities, such as dealing drugs. This probably would be in the form of a restraining order rather than an eviction since the family member is not a tenant. Your sister-in-law’s status would be a bit less clear since she might be treated as a holdover tenant. All of that said, continuing the lease with your brother but not his wife could be somewhat helpful since your sister-in-law would have to work through your brother to bring any legal action herself.

Turning to trust law, which is more my domain, you are in a very difficult position because it’s difficult to meet the interests of all the beneficiaries, including yourself and your children as well as your brother. It would probably be in your best interest to sell the house or at least rent it out at market rent. It sounds like the trust also holds some savings and investments, so you could charge your brother half the market rent for your share of the house, transferring funds from his trust to your trust. (He shouldn’t pay the full market rent since his trust is a half owner of the house.) But you, of course, are also trying to carry out the wishes of your parents which were probably to take care of your brother during his life with the remainder of the trust assets passing to your children. You may just have to muddle through. To place some distance between yourself and your sister-in-law, you might hire a professional trustee to take your place or a property manager to deal with her complaints.

Showing 2 comments
  • FBN
    Reply

    Thanks for the detailed answer. After consulting with the attorney who represented me when my brother tried to remove me as trustee without cause, she said to muddle through as you said otherwise I will be most likely be dealing with another lawsuit.

      • Harry Margolis
        Reply

        Fred,
        It’s always heartening when attorneys agree.
        Harry

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