A revocable trust, as the name implies, can be changed by a grantor without anyone’s permission. This includes firing a trustee and choosing a new one. To change a revocable trust, the grantor must generally draft a special document: an amendment to the trust. The amendment should specifically describe what is being changed -- in this case, the identity of the trustee. The grantor should sign the amendment and comply with state law guidelines for amending a trust. For example, he may need to get the amendment notarized.
Irrevocable trusts, as the name implies, are harder to change. The grantor no longer has control over trust assets and has less freedom to change the trust's terms. In this case, the existing trust agreement -- the document drafted by the grantor when the trust was created establishing the terms of the trust -- is extremely important. A well-written trust agreement will often provide a method for firing a trustee. For example, the document might outline under what circumstances a grantor or beneficiary may fire a trustee and the process for the trustee’s dismissal.
In addition to the terms of the trust agreement itself, another safeguard against a rogue trustee is a "trust protector." A trust protector is a person chosen by the grantor to oversee the trustee and make sure he is meeting his obligations. The chief power of the trust protector is the ability to replace the trustee. As of July 2012, however, only five states recognize the role of a trust protector: Alaska, Delaware, Idaho, South Dakota and Wyoming.
If an irrevocable trust does not have a trust protector and does not provide a method for dismissing a trustee, you will need to rely on state law. Trust law varies by state, so the process for dismissing a trustee will vary. Generally, an irrevocable trust may be changed in two ways. The first way is for the grantor and all of the beneficiaries to agree that the trustee needs to change. As a group, they would petition a state court to amend the trust so a new person can be named trustee. The second method is for a grantor or beneficiary to unilaterally petition the court to change the trustee. Generally, a court will change the trustee only if the trustee is found to be unfit for the job or failed in his responsibilities to the trust.
Filing a Motion
The process for petitioning a court to change a trustee varies among states, but generally you will need to prepare a motion outlining the reasons for the trustee's removal. The motion should identify the trust, current trustee and all interested parties. The motion should be filed with the clerk of the court that will consider the motion, and a date will be scheduled. You must notify all interested parties, including the current trustee, of the hearing date and provide each party with a copy of the motion.