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February 27, 2026 Posted In Trusts
In Colorado, the law grants a trustee significant authority to manage trust assets. This discretion, however, is not absolute power. It is strictly tethered to the legal obligations outlined in the Colorado Uniform Trust Code (UTC). When a trustee’s actions suggest they are serving their own interests rather than those of the beneficiaries, it may be time to consider a lawsuit for breach of fiduciary duty.
If you suspect trust assets are being mishandled or that a trustee is not being transparent, our firm may be able to help. We will review the trust instrument and financial records to determine if a breach has occurred. Contact Colorado Estate Matters, Ltd to understand your rights.
We will review the trust instrument and financial records at no cost during your initial consultation to determine if a breach has occurred.
To successfully sue a trustee, your claim must be anchored to a violation of a specific duty defined by law. The Colorado Uniform Trust Code, specifically C.R.S. § 15-5-801 et seq., establishes the core obligations of a trustee.
The most stringent duty. The trustee must administer the trust solely in the interests of the beneficiaries. Any form of self-dealing or conflict of interest is a direct violation.
A trustee is required to manage trust assets with reasonable care, skill, and caution. This includes following the Colorado Uniform Prudent Investor Act, which governs investment decisions.
The trustee must treat all beneficiaries fairly. They cannot favor one beneficiary over another, whether income beneficiaries or remainder beneficiaries.
Always review the trust document itself, as its terms can sometimes modify these default rules. However, no trust document can waive the trustee’s fundamental obligation to act in good faith.
For a complete overview of what trustees are legally required to do, see: Your Trustee Duties: Here’s What You Need to Know.
Many beneficiaries become concerned when they see poor investment returns, but a negative outcome alone is rarely sufficient grounds for a lawsuit. The court’s focus is on the trustee’s conduct and decision-making process, not just the financial results.
Certain behaviors, however, may cross the line from poor judgment to an actionable breach. These are major red flags that require immediate attention from a legal professional.
If you have witnessed any of these actions, it may be time to explore your options for suing a trustee for breach of fiduciary duty in Colorado.
In Colorado, your window to file a claim can close in as little as one year. Don’t wait—contact us now to protect your rights.
To win a case in a Colorado District Court or the Denver Probate Court, you need documented proof. The most effective tool for uncovering misconduct is the formal Demand for Accounting.
Under C.R.S. § 15-5-813, a trustee has a legal requirement to keep beneficiaries informed and provide regular reports, or accountings, when requested. If a trustee is evasive or refuses to provide this information, we can petition the court to compel them to do so.
Generally, the responsibility of proof is on you, the beneficiary, to show that a breach occurred. However, if evidence of self-dealing emerges, the burden typically shifts to the trustee to prove that their actions were, in fact, fair to the trust.
See our related guide on the full trust litigation process: Trusts & Taxes: FAQs About Tax Obligations for Trusts and Trustees.
This is common in family trusts. A trustee who is also a beneficiary still owes a full fiduciary duty to all other beneficiaries. They cannot use their position to favor their own interests, such as by living in a trust-owned property rent-free or making distributions only to themselves.
Yes. Corporate trustees are held to a higher professional standard of care and skill than a family member serving as trustee. If their investment strategies are unsuitable, fail to follow the trust’s stated goals, or they fail to properly diversify, they may be liable for the resulting losses.
This is a difficult situation that underscores the need to act quickly. In cases of egregious misconduct where the facts are strong, some firms may consider alternative fee arrangements. In certain circumstances, it may be possible to seek a court order to freeze the remaining trust assets to prevent further depletion.
Yes. You can file a petition with the court seeking only the removal of the trustee due to a persistent failure to administer the trust effectively, even if a full accounting of financial damages is not the primary goal.
A trustee’s silence may be a breach in itself. Under Colorado law, trustees have a clear duty to keep qualified beneficiaries reasonably informed about the trust’s administration. We can file a petition with the court to compel the trustee to release the information they are legally required to provide.
If you are also evaluating whether to contest the trust document itself, our overview may help: The 4 Legal Grounds for Contesting a Will in Colorado.
A trustee’s authority is a responsibility, not a license for personal gain or negligence. When that responsibility is abdicated, Colorado law provides clear mechanisms to remove the trustee from power and restore the assets they may have lost. The longer a breach goes unaddressed, however, the more difficult it becomes to recover the funds.
If you are struggling to get answers from a trustee or suspect assets are being depleted, call Colorado Estate Matters, Ltd. We will help you demand the necessary accounting and determine if suing a trustee for breach of fiduciary duty is the right step to protect your future.
Our Lakewood attorneys handle trust litigation with deep focus and direct communication—no jargon, no runaround. Your free consultation is waiting.
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