How to Remove a Trustee
A trust is administered by a trustee — a person selected by the settlor (the person who creates the trust) to administer the trust’s assets for the benefit of the trust’s beneficiaries. Because the settlor specially selected the named trustee to fulfill that role, the text of the trust instrument controls what his or her duties are and how long he or she will serve. But what if the named trustee is unable, unwilling, or unfit to perform his or her duties? Absent a provision in the trust that authorizes trustee removal, the beneficiaries of a trust may petition a court to remove a trustee if they can prove that the trustee has breached one or more of his or her fiduciary duties.
Below, we’ll examine the fiduciary duties trustees owe to a trust’s beneficiaries and a few possible grounds for removing them.
What is a “Fiduciary Duty”?
A fiduciary relationship is a relationship in which an individual or group of people place confidence, trust, and reliance in someone who is under a duty to act for the individual’s or group’s benefit. The duty the fiduciary owes is called a fiduciary duty. Examples of fiduciary relationships include those between doctors and their patients, attorneys and their clients, and members of the clergy and their congregants. A statutory fiduciary relationship also exists between a trustee and the beneficiaries of a trust. Under the Florida Trust Code, a trustee must “administer the trust in good faith, in accordance with its terms and purposes and in the interests of the beneficiaries.” This includes the duty to administer the trust prudently, impartially, and solely in the interests of the beneficiaries, as well as to keep the beneficiaries informed of the financial health of the trust through periodic accounting.
Grounds for Removing a Problem Trustee
Courts generally are willing to remove trustees when the trustee in question has breached one or more of the above fiduciary duties to the trust’s beneficiaries. However, the language of the Trust Code is rather vague—for example, what does it mean when a trustee fails to act “prudently” or acts in bad faith? Some of the behaviors that typically qualify as breaches of fiduciary duty include:
- Failure to comply with the trust’s terms
- Failure to provide a periodic accounting to the beneficiaries
- Self-dealing (i.e., using the trust’s assets for the trustee’s personal benefit)
- Commingling the trustee’s personal assets with the trust’s assets
- Mismanagement of trust assets
- Hostility toward the trust’s beneficiaries
Absent a breach of fiduciary duty, a court also may be willing to remove a trustee when:
- There is a lack of cooperation among multiple trustees, or
- When there has been a significant change in circumstances or removal is requested by all of the beneficiaries, so long as removal would not frustrate a material purpose of the trust.
Contact a Boca Raton Trust Challenge Attorney
If you are struggling with a trustee who you believe is unfit for the role, you might want to consider speaking with a Boca Raton trust challenge attorney to explore your options. To get started, contact the attorneys at the Ellis Law Group by contacting us online or calling 561-910-7500.