When a Trustee Becomes a Burden: Knowing When to Remove Them

The role of trustee carries significant responsibility. A trustee must not only honor the trust creator’s wishes but also manage assets for the benefit of the beneficiaries with accuracy, transparency, and fairness. While being named as trustee reflects confidence and trust, serving is voluntary. And sometimes, removal becomes necessary.

Depending on the trust document and state law, the authority to remove a trustee may lie with the trust creator, beneficiaries, co-trustees, or the court. Reasons for removal range from mismanagement to conflicts of interest to incapacity. Because replacing a trustee can disrupt administration and create additional costs, careful trustee selection and naming backups from the outset are critical.

What Does a Trustee Do?

A trustee is the person (or institution) legally appointed to manage trust assets according to the trust’s terms. Their responsibilities often include:

• Managing and investing trust property responsibly
• Paying expenses, taxes, and bills
• Making distributions to beneficiaries as directed
• Keeping accurate records and preparing reports
• Filing trust tax returns
• Communicating with beneficiaries
• Acting impartially among multiple beneficiaries
• Protecting and maintaining trust property

Trustees must follow the trust’s terms closely and uphold their fiduciary duty—the legal obligation to act in the beneficiaries’ best interests, with the highest standard of care. Breaching this duty may be grounds for removal.

Who Can Remove a Trustee?

The ability to remove a trustee depends on the type of trust, the trust’s terms, and applicable state law.

• Grantor (trust creator). While alive and competent, the grantor of a revocable trust may remove or replace a trustee at will, without court involvement.

• Beneficiaries. For irrevocable trusts—or after the grantor’s death—beneficiaries may petition the court to remove a trustee for good cause (such as mismanagement or breach of duty), unless the trust outlines a different process.

• Co-trustees. If multiple trustees serve together, one may seek to remove another, though court approval is often required unless the trust provides otherwise.

• Courts. When disputes arise or no other authority exists, the court may step in to remove and replace a trustee.

Some modern trusts also appoint a trust protector, an independent third party empowered to monitor and, if necessary, replace the trustee without court involvement.

Common Reasons for Removal

Trustees may be removed when they fail to fulfill their obligations. Common grounds include:

• Failure to perform duties (e.g., not filing tax returns, ignoring beneficiary requests)
• Poor management or risky investments leading to losses
• Conflicts of interest or self-dealing (e.g., selling trust assets to themselves at below-market value)
• Hostility or deadlock with beneficiaries or co-trustees that halts administration
• Unavailability or lack of time to properly manage the trust
• Excessive fees that deplete trust assets
• Illness or incapacity preventing effective service

Sometimes, trustees resign voluntarily when they feel unable to continue. If not, beneficiaries or co-trustees may need to pursue removal through the court.

The Cost of Removal

Removing a trustee is rarely simple or inexpensive. Court petitions require time, evidence, and often significant legal fees. In some cases, trust funds may cover these costs; in others, beneficiaries or trustees may bear them personally.

To minimize disruption, the trust document should clearly outline how a successor trustee is appointed. Without a succession plan, courts may appoint someone unfamiliar with the grantor’s wishes, causing delays, increased expenses, and hardships for beneficiaries.

Keep Your Plan Current

Trustee choice is one of the most important decisions in estate planning. Reviewing your estate plan regularly ensures that your trustees and successor trustees remain appropriate as relationships and circumstances change. Naming backups and considering the role of a trust protector can provide additional safeguards.

The right trustee can help your estate plan succeed. The wrong trustee can undermine it. Our estate planning attorneys can guide you in selecting trustworthy decision-makers and addressing trustee-related concerns.

Contact us to review your estate plan and ensure your wishes (and your beneficiaries) are protected.