It’s a question that comes up surprisingly often. Can a trustee represent herself in a lawsuit? In other words, does a trustee always need a lawyer in court?
The short answer (there is some nuance): yes, a trustee needs a lawyer in court proceedings. Letting a non-lawyer trustee appear in court directly would amount to the unauthorized practice of law.
A recent Alaska case illustrates the point
Back in 2010, Robert Newman sold a piece of property in Fairbanks, Alaska, to Rodney Bluel. After Newman’s death later that year, his estate was transferred into a trust. Bluel also created a trust, and transferred his interest in the property into that trust. In 2011 everyone signed a new note and deed of trust making clear that the Rodney K. Bluel Trust owned the property, and owed $313,873.34 to the Newman Supplemental Needs Trust.
Rodney Bluel died in 2013, and his son Richard became trustee of the trust. Over the next few years, Richard Bluel made sporadic payments on the note to the Newman Trust, failed to keep property taxes current and (according to the Newman Trust’s trustee) turned the property into “a junk yard.”
In 2018 the trustee of the Newman Trust sought to foreclose on the note. She served Richard Bluel as trustee of the Rodney Bluel Trust. Richard ultimately responded, filing various motions seeking dismissal of the complaint. He also claimed that the property belonged to him individually, and he sought to file a response on behalf of his father’s trust.
The Newman Trust’s lawyer objected to Mr. Bluel’s response, arguing that a trustee needs a lawyer in any court proceeding. The trust is a separate legal entity, argued the attorney, and Richard Bluel would be engaging in the unauthorized practice of law if he were allowed to represent the trust himself.
The trial court is unsure who has been sued
After reviewing the circumstances, the trial judge decided that the lawsuit was against Richard personally, and amended the caption to name him individually. The Newman Trust’s trustee appealed to the Alaska Supreme Court, which reversed the trial court’s order and remanded the case for further proceedings. The state’s high court ruled that:
The law does not permit a non-lawyer trustee for an express trust to appear self-represented in the lawsuit in a representative capacity for the trust; the non-lawyer trustee must be represented by an attorney.
In its second look at the dispute, the trial court ruled that Richard Bluel could not represent the trust in court — the trustee needs a lawyer in legal proceedings. Richard Bluel mostly argued that he thought the Newman Trust’s lawyer should have a business license. Richard never obtained an attorney, and stopped attending court hearings in the foreclosure action. Ultimately the trial judge entered a default judgment allowing the Newman Trust to recover the property. She also imposed an additional judgment of $33,328.48 against the Bluel Trust for unpaid property taxes.
Richard’s next step(s)
Richard Bluel appealed the foreclosure order and sale. He also created a new trust and attempted to transfer the property into that trust’s name. The Alaska Supreme Court was no more impressed by his arguments the second time around than it had been in his first.
Richard Bluel filed his appeal himself — without yet acknowledging that the trustee needs a lawyer to appear in court. “Because Richard Bluel is not a lawyer,” the Court wrote, “he may not appear on behalf of the Bluel Trust in appealing that judgment. His attempts to represent the Bluel Trust on appeal are invalid, and we decline to address the arguments in his briefing. Because the Trust has not taken any valid action to prosecute its appeal of the judgment against it, we dismiss the appeal.” In other words, Richard Bluel, as trustee, needs a lawyer to participate in court proceedings. Bluel, Trustee of Rodney K. Bluel Trust v. Niggs as Trustee of Newman Supplemental Needs Trust, April 28, 2023.
Are there larger lessons to take away?
This odd little property dispute between two different trusts actually addresses an issue that we commonly see. A trust is a separate legal entity, and it is not an individual. Nor is the trustee the actual party. In a nutshell, a trustee needs a lawyer in order to appear in court.
That observation helps explain the nature of even your revocable living trust. Think of it like you would a corporation, or a formal partnership arrangement, or a limited liability company. It is a separate entity, even though it might be completely under your control. When you act on behalf of your trust you do it as trustee and not as an individual.
Does that mean that your trust can not be sued, or can not sue? Of course it doesn’t. But it does mean that even you, as trustee, need a lawyer to file or defend an action. It doesnt come up very often, but it helps keep your relationship with your trust clear to remember that rule.