Petitions to Remove or Compel Trustee

If you are engaged in a dispute with a trustee who is bound to manage assets for your benefit, you should contact a lawyer at the Citadel Law Corporation to protect your rights. If necessary, we can compel or pursue the removal of the trustee.

The Duties of a California Trustee

When a legally appointed steward is in breach of their duties to uphold the terms of their trust, the beneficiaries may file a petition to remove trustee California. State law requires a trust's assets, such as income, capital, property, businesses, and art, to be deliberately and effectively managed to advance the interests of the beneficiaries. In addition to these responsibilities, beneficiaries must have ample, regular opportunities to communicate and ensure that tax preparers file federal and state income tax returns while the trust is legally in effect.

Trustees owe a fiduciary duty to their beneficiaries, which means they must:

• Remain loyal to beneficiaries.

• Treat assets with ordinary care.

• Treat their beneficiaries impartially.

• Gather the trust's assets.

• Govern and manage assets according to the terms of the trust.

If a trustee is derelict in their duties to their beneficiaries under the California Probate Code or common law, then an interested party may act to compel or remove them from the trust. Grounds for removal may include the following behavior and conduct:

1. Giving preferential treatment to one or more beneficiaries

2. Putting their own interests first

3. Embezzling or misusing assets

4. Intermixing trust assets and personal assets

5. Negligent management

6. Failing to abide by the terms of the trust

Without a significant amount of legal training, it can be difficult to accurately identify grounds for removal. A beneficiary or co-trustee should seek the advice of legal counsel before discussing removal with the trustee or taking legal action.

The Process of Removing a Trustee

When a trust is irrevocable, an interested party must petition the California probate court to compel an accounting or remove the trustee. The petitioner must give 60 days notice before they can file the petition to compel accounting form with the court.

Section 15642 of the California Probate Code provides the legal foundation for removing a trustee from a trust. To proceed with this course of action, the interested party must file a petition in probate court that includes an itemized list of reasons for removal that meet at least one of the following conditions:

• The trustee is in breach of trust.

• The trustee is deemed an unfit manager.

• The co-trustees are hostile or uncooperative in a manner that undermines the proper management of assets.

• The trustee is receiving excessive compensation for their work.

• The trustee drafted the trust document, thereby creating a conflict of interest.

• The trustee lacks the capacity to perform their administrative duties.

• There is a refusal or failure to act in accordance with the terms of the trust.

• The trustee succumbs to undue influence or engages in fraudulent activity.

• There is another good reason to remove the trustee.

Generally speaking, the court will hold hearings to review any petitions and any of the trustee’s objections and responses. When these procedural steps are complete, the petition will be “at issue” and the discovery process can begin. At this time, the beneficiaries will gather and present evidence to prove their case.

It’s common for parties to settle the case voluntarily; otherwise, the court will set a trial date. If the evidence is sufficient, the court will replace the current trustee with a suitable successor.

Do You Need a Lawyer to Remove a Trustee?

When a living trust is in effect, the person who created it can amend it to remove the current trustee and install a replacement, or revoke the trust altogether. There may also be cases where the terms of the trust empower beneficiaries to expedite removal and replacement without court intervention.

The administration of an irrevocable trust is at the discretion of the trustee. Poorly performing investments and unfortunate decision-making may not provide sufficient grounds for removal. If the interests of individual beneficiaries are misaligned with the actual terms of the trust, then the court may not see a perceived breach, such as disloyalty to the beneficiary, as unlawful.

An attorney who specializes in California trust law can identify legal grounds for removal and bring the case to court. They will present evidence that maximizes the chances of winning the case and attempt to recover any associated damages. Contact an experienced Orange County trust attorney at the Citadel Law Corporation to discuss your legal needs. Call 949-852-8181 to schedule an appointment with an attorney today.