Throwaway account- (sorry!!!)
My aunt and uncle divorced late last year after being married over 30 years. About 8 years ago, my paternal grandmother passed away and left a trust worth approximately $2.5 million. She named my aunt (her daughter-in-law at the time) as trustee, not my uncle, because she didn’t trust him to manage the money responsibly.
Around the same time of his mom’s passing, my uncle got involved in a lawsuit and ended up losing about $1 million of the trust’s money due to that case. Since then, my aunt has generally upheld her trustee duties except she did not provide quarterly reports, but only because my uncle explicitly told her they weren’t necessary.
Over the years, the rest of the trust has been spent. Approximately:
$1.2 million was spent by my uncle (on a house, RVs, vehicles, and other discretionary items),
$225,000 was spent by my aunt (used as a house down payment and to pay off her car. She also used some of this money to pay off credit card debt accrued by my uncle. My uncle verbally told her she could do this).
All of this spending occurred during their marriage. In the divorce settlement, my aunt was awarded her house and my uncle kept his, and the decree explicitly says neither party owes the other any further money or assets.
Now, post-divorce, my uncle is claiming my aunt mismanaged the trust and is threatening to sue her unless she pays him ~$20,000 and gives him equity in her home. He says she owes him for mismanaging the trust and not giving him reports. She does not want to give him any more money and he is threatening to get a lawyer and come after her for even more money than what he is asking for right now.
My aunt is extremely stressed, and we’re unsure if he has any legal basis for this. Is there any real legal risk to her? Could she be found liable, or does the divorce settlement help protect her?
Location: Oregon
Thank you so much for any insight.