Can the Powers of the Successor Trustee Be Revoked?

By David Carnes

A successor trustee is a trustee who takes over management of a trust after the original trustee leaves office. He may be a party named in the trust deed, consented to by the trust grantor or beneficiaries, or appointed by a court. State laws provide several ways in which a successor trustee's powers can be revoked and the trustee removed from the position.

A successor trustee is a trustee who takes over management of a trust after the original trustee leaves office. He may be a party named in the trust deed, consented to by the trust grantor or beneficiaries, or appointed by a court. State laws provide several ways in which a successor trustee's powers can be revoked and the trustee removed from the position.

Trust Protectors

A successor trustee may be removed in accordance with the terms of removal set forth in the trust deed. Many trust deeds appoint a trust protector whose job it is to hire and fire trustees. The trust deed may specify permissible grounds for removal or allow removal at will. Accordingly, if you seek removal of a successor trustee, appeal to the trust protector -- if any -- to unilaterally remove the trustee.

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Removal by Grantor

A trust may be revocable or irrevocable, depending on the terms of the trust deed. If the trust deed does not address the issue of revocability, different states apply different presumptions -- some states presume the trust deed is revocable while others presume it is irrevocable. If the grantor is dead, the trust is always irrevocable. If the trust is revocable, however, the grantor may unilaterally amend its terms to remove the successor trustee and appoint a new one.

Removal by Beneficiaries

If the trust is irrevocable, it may contain a provision allowing the beneficiaries to unanimously agree to remove a successor trustee. It may also require the grantor's consent if he is still alive. Some trusts, however, provide for unborn or minor beneficiaries. Since unborn and minor children cannot consent to the removal of a successor trustee, the living adult beneficiaries may lack the power to remove the trustee even with unanimous consent. In this case, a court order may be required to clarify the issue under state law.

Removal by Court Order

If the trustee cannot be removed under the terms of the trust deed, a court order may be required to remove the successor trustee. A court will not remove a successor trustee simply because the beneficiaries do not like him. He must have committed acts of misconduct or the court determined removal would best effectuate the original intentions of the trust grantor with regard to the disposition of trust assets.

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References

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