Whether you are establishing a trust document and considering who to name as your trustee(s) or a co-trustee of a trust, you may be wondering: “Do co-trustees have to act jointly, or can a co-trustee act alone?”
This is a great question. We will explore the answer from both perspectives as we examine what authority trustees have if and when it becomes necessary to navigate the trust administration process.
How Are Co-Trustees Determined?
An estate plan is a crucial thing to have in place. It allows you to express your wishes for your loved ones and assets after your death and gives you, your family, and your friends peace of mind.
An estate plan can involve a will and ancillary documents that may include medical powers of attorney, financial powers of attorney, etc. You may also decide to establish a trust document (also known as a “trust instrument”) which can be helpful for many reasons. One primary reason is to avoid probate to maintain privacy for your estate and loved ones and avoid going to court to administer your estate.
When establishing your trust, you must name at least one successor trustee in the event of your death to administer your assets. This is when you may consider appointing co-trustees, whether you have two or more in mind. A trustee may either be an individual or a financial institution.
If you have an established attorney-client relationship, you may even wonder if you can name your attorney as your successor trustee. It is best to avoid this as it can raise several ethical issues for your attorney.
The Pros and Cons of Having Co-Trustees
Having co-trustees appointed to administer a trust in California has its pros and cons. If you are considering establishing co-trustees, it is essential to consult an estate planning attorney.
By naming more than one trustee, you can cover your bases if one is out of the country or incapacitated in the event of your passing. However, this can also be established by naming successor trustees.
One of the primary disadvantages can occur for beneficiaries. This happens when the trustees cannot agree on essential matters, leading to litigation and a delay in the distribution of assets.
If you are facing this situation, it is crucial to understand that we can help you seek court intervention and remove one or both of the trustees. Seeking the removal of trustees can be a complicated matter that requires the assistance of an experienced probate litigation attorney. You must act quickly when co-trustees refuse to cooperate because harm can result to the trust and its beneficiaries, such as:
- If the co-trustees are not on the same page about managing the trust, it can result in mismanagement or neglect of the assets
- Beneficiaries are unlikely to receive their inheritance in a timely matter
- The trust accounting may be delayed or inaccurate when the co-trustees fail to work together
- Beneficiaries will not receive communication regarding what is going on with the trust administration
- Trust assets may be wasted if the trust is not effectively and efficiently administered
Do Co-Trustees Have to Act Jointly?
Allowing the trustees to act independently of each other could help speed up the administration process. In California, trust law dictates that co-trustees must act unanimously. However, if the trust document states that they can act independently, the trust will trump California trust law.
Are You Seeking to Remove a Co-Trustee?
This article is for informational purposes only and should not be used as a substitute for legal advice from an experienced attorney. If you believe one or more co-trustees have breached their fiduciary duties, don’t delay seeking the guidance you need. The Legacy Lawyers have assisted numerous clients in the same situation as you.
At The Legacy Lawyers, we are dedicated to your peace of mind. We will walk you through your trust litigation matter step by step. Contact us at (714) 963-7543 to schedule your consultation.