What is a Constructive Trust in California?

Oakland Probate Lawyer Provides Counsel for Beneficiaries of Defective Wills

Photo of a legal documentA typical trust allows a third party to keep or use assets on behalf of the beneficiary. Usually, a trust is established by a person who wishes to transfer property to an heir. A constructive trust, on the other hand, is not a true trust because it is established by the courts, not an individual. Instead, it is a legal remedy to correct “unjust enrichment” that can result from undue influence, fraud or any defective trust or will. Additionally, if a trustee commits a breach of fiduciary duty by misusing a traditional trust, a constructive trust can restore the property in question to the rightful owner.

Charles Triay, probate lawyer and founder of Triay Law Office, has over 30 years of experience with contested and defective wills in Northern California. Additionally, he has specialist certifications in probate, estate planning and trust law. If you believe someone fraudulently obtained property from a relative, possibly through a defective will, contact Charles Triay for information about constructive trusts.

What is a Constructive Trust?

In certain cases, a court order may establish a constructive trust in order to essentially right a wrong that resulted in a person taking wrongful possession of property. In order for the courts to consider a constructive trust, you and your probate lawyer must demonstrate:

  1. The existence of property. If the defendant took possession of physical property such as an heirloom, this requirement may be easily met. However, if the defendant obtained money through fraud or misrepresentation, you and your lawyer will have to prove that the defendant used that money to buy the property in question.
  2. Your right to the property as the plaintiff. Often, this requires proof that you are the rightful heir to the money or property in question.
  3. The defendant wrongfully acquired the property. Most often, the defendant obtained the property through dishonest or illegal means.

If the court finds that the defendant has unjustly benefited from property that is rightfully yours, a constructive trust can be used to make things right. By court order, a constructive trust imposes trustee status on the defendant. This means that he or she can hold the property with limited legal power but cannot benefit from it.

This trustee relationship typically continues only a short time, since the court will then order the defendant to transfer the property in question to the rightful beneficiary. This helps remedy the losses suffered by the plaintiff and ensure that the defendant does not continue to receive wrongful benefit.

What are Common Reasons for a Constructive Trust?

There are many different ways a person can unjustly benefit from someone else’s property. These include:

  • Undue influence and/or lack of capacity. A caregiver may use his or her influence over an elderly charge to gain money or property. Sometimes, a caregiver may bully or persuade a person into giving him or her gifts or money. In such cases, the family and/or rightful heirs may contest the will or petition for the return of this property.
  • Fraud. The defendant may have taken possession of property as a result of criminal deception, either implied or explicit.
  • Breach of fiduciary duty by a trustee. Most commonly, a constructive trust is necessary to ensure a traditional trust benefits the right person. In these cases, the trustee typically misuses the property in trust, often for his or her own benefit. If so, the rightful beneficiary can recover the property through a constructive trust.

Whether or not the court will order a constructive trust depends on whether or not the defendant actually owns property. For example, a caregiver may exert undue influence in order to wrongfully obtain a sum of money. If the caregiver purchases property with that money, such as a home, you may be able to take possession of that home through a constructive trust. If the caregiver uses the money on an expensive vacation, a constructive trust will likely not be beneficial. However, you may have other options for recovery.

Questions About Trusts? Call for a Free Consultation with a San Francisco Probate Lawyer

If you believe a constructive trust may help you recover your rightful property, contact probate lawyer Charles Triay. He has practiced estate and trust law in California for over 30 years, and specializes in these kinds of cases. He can use this experience to assist you in gaining remedy for your wrongs. In addition, the Triay Law Office allows clients to choose between paying attorney fees on a contingent or hourly basis. Contact our San Francisco law firm to schedule a consultation today.