INSURANCE

Trustee is a legal term that refers to a holder of property on behalf of a beneficiary. A trust can be set up either to benefit particular persons, or for any charitable purposes (but not generally for non-charitable purposes): typical examples are a will trust for the testator's children and family, a pension trust (to confer benefits on employees and their families), and a charitable trust. In all cases, the trustee may be a person or company, whether or not they are a prospective beneficiary.

Trustees have certain duties (some of which are fiduciary). These include the duty to carry out the express terms of the trust instrument, the duty to defend the trust, the duty to prudently invest trust assets, the duty of impartiality among the beneficiaries, the duty to account for their actions and to keep the beneficiaries informed about the trust, the duty of loyalty, the duty not to delegate, the duty not to profit, the duty not to be in a conflict of interest position and the duty to administer the trust in the best interest of the beneficiaries. These duties may be expanded or narrowed by the terms of the instrument creating the trust, but in most instances cannot be eliminated completely.

A trustee carries the fiduciary responsibility and liability to use the trust assets according to the provisions of the trust instrument (and often regardless of their own or the beneficiaries' wishes). The trustee may find himself liable to claimants, prospective beneficiaries, or third parties. In the event that a trustee incurs a liability (for example, in litigation, or for taxes, or under the terms of a lease) in excess of the trust property they hold, they may find themselves personally liable for the excess.

Trustees are generally held to a "prudent person" standard in regard to meeting their fiduciary responsibilities, though investment, legal, and other professionals can be held to a higher standard commensurate with their higher expertise. Trustees can be paid for their time and trouble in performing their duties only if the trust specifically provides for payment. It is common for lawyer's to draft will trusts so as to permit such payment, and to take office accordingly: this may be an unnecessary expense for small estates.

The term trustee is also applied to someone held to a fiduciary duty similar in some respects to that of a trustee proper. For example, the directors of a bank may be trustees for the depositors, directors of a corporation are trustees for the stockholders and a guardian is trustee of his ward's property. Many corporations call their governing board a board of trustees, though in those cases they act as a board of directors.

In the case of UK charities, a trustee is an unpaid volunteer who undertakes fiduciary responsibilities on behalf of the charity, subject to the provisions of Charity Law, a branch of trust law, and the Charities Act 1993. For charity trustees, the Charity Commission of England and Wales, Office of the Scottish Charity Regulator of Scotland and Voluntary Activity Unit of Northern Ireland often has concurrent jurisdiction with the Courts. Many UK charities are also limited liability companies registered with Companies House, in this case the trustees are also Directors of the company and their liability is limited. This is the preferred model if the charity owns property or employs people.

Trustee is also a term used for a prison inmate who has special work-related privileges, usually as a result of good behavior.

In the United States, if a person is adjudged a bankrupt, a trustee will be appointed to hold legal title to the property of the debtor and to perform other duties required by the bankruptcy laws.

The United States Trustee Program is an agency of the United States Department of Justice that is responsible for overseeing the administration of bankruptcy cases and private trustees. The applicable federal law is found at 28 U.S.C. § 586 and 11 U.S.C. § 101, et seq.

In addition to the twenty-one United States Trustees, the program is administered by the Legislative Office for U.S. Trustees (EOUST), located in Washington, D.C., and 95 field offices. The United States Trustee is the federal official charged with enforcing civil bankruptcy laws in the United States.

OVERVIEW

The United States Attorney General generally appoints a separate United States Trustee for each of twenty-one geographical regions for a five year term. Each United States Trustee is removable from office by and works under the general supervision of the Attorney General (see 28 U.S.C. § 581 and 28 U.S.C. § 586(c)). Each United States Trustee, an officer of the Department of Justice, is responsible for maintaining and supervising a panel of private trustees for Chapter 7 bankruptcy cases (see 28 U.S.C. § 586(a)(1)). The United States Trustee has other duties including the oversight of administration of most bankruptcy cases and trustees (see generally 28 U.S.C. § 586(a)(3)).

Each of the twenty-one regional U.S. Trustees maintains an office in each judicial district within the trustee's region, except for Alabama and North Carolina, which are not administered by the U.S. Trustee program.

The U.S. Trustee does not have prosecution powers, but is required by law to refer information regarding potential criminal violations of bankruptcy laws to the United States Attorney.

Interim trustees serve by the U.S. Trustee's appointment in Chapter 7 cases. Generally the interim trustee is assigned at random from a "panel" of qualified individuals at the time a bankruptcy case is filed, and is automatically appointed as the "permanent" case trustee after the first meeting of creditors.

Due to the relative infrequency of filing of petitions for Chapter 12 (family farmer debt adjustment) relief, trustees for these cases are typically appointed on an ad hoc basis.

Each judicial district has one or more Standing Chapter 13 Trustees. The Standing Trustees are responsible for the administration of all Chapter 13 cases filed in their judicial district.

If for any reason all panel and/or standing trustees are disqualified or unable to perform, the U.S. Trustee may serve as trustee for a particular case under Chapter 7, 12 or 13. This very rarely happens.

The U.S. Trustee's office conducts the first meeting of creditors in a Chapter 11 case. Most Chapter 11's do not require the appointment of a trustee: however, in those cases which do, the U.S. Trustee oversees the appointed trustee's handling of the case and, for good cause, can seek the removal or replacement of the trustee. The U.S. Trustee may not, however, serve as the case trustee in Chapter 11. Along with the creditors committees, the U.S. Trustee acts as the primary "watchdog" to ensure compliance with the Bankruptcy Code in cases where no trustee has been appointed.

Accounting staffers within the Trustee's office review all debtor filings, and monitor trustee and attorney fees in all cases. Attorneys employed by the Trustee represent the office in United States bankruptcy court and pursue civil sanctions for some egregious violations of the law in Chapter 7, 12 and 13 cases.

EXECUTIVE OFFICE OF THE U.S. TRUSTEE

The Executive Office of the U.S. Trustee (EOUST) is part of The United States Department of Justice (DOJ). The EOUST is the component of The United States Department of Justice (DOJ) responsible for overseeing the administration of bankruptcy cases and private trustees. The responsibility of the EOUST as the top level office controlling DOJ attorneys who monitor conduct in U.S. Bankruptcy Courts is analogous to that of The Executive Office for United States Attorneys (EOUSA) as responsible for prosecutors (District Attorneys) of the DOJ.

In contract with the EOUSA, the EOUST maintains indirect publicity and refers to its offices as the "U.S. Trustee Program".

CRIMINAL REFERRAL

When a government attorney working at the EUOST or any of its regional or field offices observes or suspects any criminal activity, it must be referred to a District Attorney for investigation and if warranted, prosecution. The official policy of the EOUST is to include a review of such criminal referrals as part of the employee evaluation for each DOJ attorney employeed as a U.S. Trustee.

In real estate, a trust deed or deed of trust, is a document wherein specific financial interest in the title to real property is held by a trustee, which holds it as security for a loan. When the loan is fully paid, the monetary claim on the title is transferred to the borrower by reconveyance. If the borrower defaults on the loan, the trustee has the right to foreclose on and transfer title to the lender or sell the property to pay the lender from the proceeds.

Trust deeds are the the most common instrument used in the of financing real estate purchases in Alaska, Arizona, California, Colorado, Idaho, Illinois, Mississippi, Missouri, Montana, North Carolina, Texas, Virginia, and West Virginia whereas most other states use mortgages. Deeds of trust can also be for loans made for other purposes but where real estate is used for collateral.

LAYERS OF TRUST DEEDS

There are three parties to a deed of trust, the Borrower, Trustee, and Beneficiary, as opposed to a mortgage with which there are only two parties, the Borrower and the Lender.