A trustee controls and manages real property and/or other assets for the benefit of the named beneficiaries in accordance with the terms and conditions of the legal instrument (known as a "declaration of trust") which created the arrangement.
The discretion the appointees have with respect to the disposition of property under their charge can be quite limited and high standards of care govern their conduct. For example, trustees are prohibited from engaging in any form of "self-dealing," and owe the the beneficiaries an "undivided and undiluted loyalty."
When disputes arise, courts will look to see whether the appointees have comported with their responsibilities. By way of example, in Matter of Silverstein v. Goodman , several trustees were alleged to have breached their "duty of loyalty" by permitting certain of their family members to occupy a residential building for little or no rent.
When the case reached the Appellate Division, First Department, the court concluded that a Special Referee needed to calculate the amount of income denied to the trust as a result of the purported "self dealing" or "breach," so that those sums could be deducted from the miscreants' share of the building's sale proceeds.
Just goes to show you there's no such thing as "free rent."
For a copy of the Appellate Division's decision in Matter of Silverstein v. Goodman