Planning for the future of our family members and close friends is an essential reason for estate planning. Estate planning helps us to solidify not only our own futures, but the secure futures of our loved ones. There are many types of estate planning tools you can use depending on your goals, your estate, and your exact circumstances.
Trusts are a key portion of many peoples’ estate plan. With a trust, you can provide for the future of your friends or family members while still making sure your conditions are met before the support is provided. If you are forming a trust, then you will need to name a trustee.
What is a Trustee?
A trustee is responsible for making sure a trust is administered in accordance with the provisions of the written trust. Unfortunately, there may be times when the beneficiaries of the trust disagree with the actions of the trustee. In those cases, they may wonder about how to remove a trustee.
When Can You Remove a Trustee?
Unlike during probate, a trust is not necessarily administered through the court and trust documents are not automatically filed with the court; a trustee is appointed by a private individual, not a judge. Therefore, if the trust is a revocable trust, the original grantor may remove the trustee at any time for any reason, or even no reason at all; however, if the trust is an irrevocable trust, then a court order will be required to remove the trustee.
A trustee owes what is called a “fiduciary duty.” A fiduciary duty means that the trustee has a legal obligation to act in the best interest of the trust. In other words, a trustee is obligated to do his or her best to fulfill the duties outlined in the trust. Although most trustees do their best to make sure the trust is properly administered, that is not always the case, and there are times the beneficiaries may want to ask the court to remove a trustee.
It is important to understand there are reasons a court will not remove a trustee. The beneficiaries simply disagreeing with the trustee’s decision, for example, will not result in a court removing a trustee. Beneficiaries cannot have a trustee removed simply because they disagree – instead, a person seeking to remove a trustee needs to prove the trustee had breached their fiduciary duty.
Removing a trustee would require the beneficiaries to demonstrate the trustee has not simply made a bad decision, but that the decision is so bad as to mean the trustee has breached his or her responsibility to act in the trusts best interest. For example, stating a trustee has distributed assets in a way that is different than the beneficiary would have done is not enough. The person seeking to remove the trustee will need to prove that the trustee’s decision was at the very least beyond what a reasonable person would have done for the trust in the trustee’s position.