There is a lot of thought and careful consideration that goes into trust and estate planning. Establishing a trust instrument may enable an estate to avoid probate, but the job of trust administration will still fall to the person designated as “trustee” by the trust.
What happens when the designated trustee is not doing their job? How do you go about replacing a trustee with a successor trustee? Before diving in to how to remove and replace a trustee, it is crucial to understand who can initiate this process and the grounds for removal.
Who Can Remove a Trustee?
A trustee is selected by the trustor (also known as the settlor or grantor), often under good terms. However, sometimes it becomes clear that the individual chosen for the role of trustee is not the best choice and cannot carry out their duties properly.
In some cases, the trustor has a falling out with their chosen trustee, or the trustee doesn’t do right by the terms of the trust after the trustor has passed away. Should this happen, there may be a need for their removal. Under the terms of the trust and state law, there are a few designated individuals who have the power to remove the trustee:
- Trustor: The individual who has established the trust.
- Co-Trustees: If more than one person received the role of trustee.
- Trust Beneficiaries: Recipients of the estate inheritance.
- Probate Court: Under estate law, the probate court may decide to remove a trustee based on specific grounds for removal.
There are several instances in which one of the above would seek the removal of a trustee. The trustor may have included provision in the trust for a third party, such as an attorney, to remove the trustee under certain circumstances. The trustee can also request their own removal voluntarily if they believe they are not fit for the role.
Essentially, anyone named in the trust document or (if all persons named are deceased) anyone who is a personal representative of the estate may request the removal.
Reasons to Remove a Trustee
A trustee may be removed under the terms of the trust for any reasonable cause. Including, but not limited to, any of the following reasons:
- Breach of duty to act impartially, to avoid self-dealing, to prevent bias
- The trustee is unable to pay off debts or unfit to administer the trust
- Hostility among co-trustees that impairs the administration
- Failure to act or declining to act
- Excessive compensation
- The sole trustee is a disqualified person
- Insolvency of the trustee or other unfitness to administer the trust
- Other good cause
The Process: How to Remove a Trustee
The trust document should outline the terms for removing a trustee, specifying who has the power to remove the trustee, and under what circumstances they can request the removal. If the trustor, co-trustees, or beneficiaries decide to move forward with the trustee removal, their lawyer will draft a petition based on the trustee’s misconduct.
This petition will then go to the Probate Court and be reviewed by a judge. California state law allows the removal of a trustee, even if there is a no-contest clause. There will need to be evidence presented to support the request.
Seek Help from an Experienced Attorney
If you are a trustor, co-trustee, heir, or beneficiary of a trust that is being mismanaged by a trustee, we can help you seek their removal. Trustees who refuse to provide copies of the trust, do not communicate, treat trust assets as their own, and neglect their fiduciary duty should be held accountable for their actions.
It is essential to contact a lawyer right away if you feel the trustee is abusing their duties. People often wait until it is too late, and the trustee has depleted the trust assets.
Feel free to contact us to schedule your no-cost consultation. We are here to help, simply call us today at (800) 840-1998. Our law firm is dedicated to your peace of mind.