A successor trustee is an individual or entity who replaces the original named trustee, generally through death or incapacitation. Removing a successor trustee can be a complicated process when an irrevocable trust is involved and no such provision is so instructed. A College Station estate attorney will need to weigh your options if you need a successor trustee removed.
Removal of the Successor Trustee
A successor trustee succeeds a previous one as per provisions in the trust. For instance, a grantor may create a revocable trust and act as trustee, but write into the trust that a named individual is to succeed him when he dies or becomes incapacitated. A successor trustee may also be named for an irrevocable trust. Either way, once the grantor dies, even a revocable trust becomes irrevocable, and any removal of a successor trustee will need court action if the trust does not grant beneficiaries specific power to remove the trustee.
Some trusts appoint a trust protector. The role of this individual is to remove a trustee by request of the beneficiaries. If no such agent is appointed and the grantor is dead, the beneficiaries do not have the power to remove the successor trustee. It will be necessary to get Texas probate court involved. The court will hear the arguments of the beneficiaries for removal and make a determination on whether such action is warranted. Among reasons courts may remove a trustee are as follows:
- The trustee commits some form of misconduct, such as mismanagement of the trust funds or negligence of duty.
- The trustee does not abide by the original intentions of the grantor.
- The trustee fails to make a proper accounting as is required by law.
- The trustee becomes incapacitated and can no longer perform the functions of the position.
In order to remove the successor trustee, then, the beneficiaries petition the court, and a hearing will be conducted to determine whether one of the above applies. If so, the court may remove the trustee and appoint another.
In some cases a trustee may be ordered to pay compensatory damages to the beneficiaries for any loss that occurs as a result of wrongful action. Moreover, the court may reverse a transaction that was made in violation of the instructions of the trust.
If You Have Questions or Need Assistance with Your Estate Plan