When a Beneficiary "Can't Get No Satisfaction": How to Remove a California Trustee in 3 "Easy" Steps...
How do you remove a California Trustee in three “easy” steps? In truth, the steps aren’t so easy. But Trustee removal is not impossible either. It just takes time (a lot of time), patience, money, and emotional fortitude. (See our What to Expect series for a more detailed discussion of the litigation process).
The legal basis for removal is found at California Probate Code Section 15642, which lists the following grounds for Trustee removal:
- Where the Trustee has committed a breach of Trust,
- Where the Trustee is insolvent or otherwise unfit to administer the Trust,
- Where hostility or lack of cooperation among cotrustees impairs the administration of the Trust,
- Where the Trustee fails or declines to act,
- Where the Trustee’s compensation is excessive under the circumstances,
- Where the Trustee is the same person who drafted the Trust document,
- Where the Trustee lacks capacity,
- Where the Trustee cannot resist fraud or undue influence, and
- For other good cause
Now that you know the grounds for removal, how do you go about removing a Trustee?
Step 1. Starting the Removal Process. Let’s start at the “easy” part—the procedure. Procedurally, to remove a California Trustee you have to file a petition in Probate Court. Before filing in Court, however, you should look at the Trust document. Some Trust documents give the beneficiaries the power to remove and replace a Trustee. If that is the case, then removal can be accomplished outside of Court.
If the beneficiaries do not have the power to remove the Trustee under the Trust document, then they must file a Trustee removal petition. In the petition you must state all the reasons for removal, and those reasons must fit into one of the nine categories listed above.
After filing the Trustee removal petition in Court, you wait. The Court will give you an initial hearing date, which you must serve on all interested parties (e.g., the Trustee and all the other Trust beneficiaries). At the initial hearing nothing will happen! The initial hearing is just the first chance for the Court to review the petition and see if anyone is going to object to the relief you are seeking. In most cases, if you are trying to remove a Trustee, the Trustee will most likely object to your petition. The Trustee can either object in writing before the hearing or can appear in person (or have his or her lawyer appear in person) and object right there at the initial hearing. The Court will then allow the Trustee some time to file a written opposition.
You will then be given another hearing date, and when you appear at that second hearing date…nothing will happen. Sound familiar? The petition is not officially “at issue,” as they call it, until everyone files their written objections and responses.
Step 2. Conducting Discovery of Evidence. Once the petition is at issue, the discovery process begins. Discovery is the process where you try to gather together as much evidence as you can to prove your case. You send documents requests, written interrogatories (fancy word for “questions”), requests for admission, etc. You also serve any subpoenas on third-parties, such as banks and brokerage firms if you are trying to gather financial information for the Trust.
At some point, you can even take the deposition of the opposing party and they are allowed to take your deposition as well if they choose to. You may also have to hire an expert witness to testify to the Trustee’s duty of care and whether they met the reasonable standard of a Trustee. Or an expert on financial investing to discuss how the Trustee invested Trust assets; or an accounting expert to discuss how the Trustee accounted for the Trust assets. The opposing party will have the right to depose each of your experts and you can do the same for their experts.
Step 3. Your Day in Court. At some point, the Court will set a trial date. Trial dates are usually set much further out in time than you would like. And it’s not uncommon for trials to be delayed multiple times before actually getting under way. But eventually, trial commences and evidence must be produced as required under the California Evidence Code.
Or maybe trial does not commence because in so many cases the parties reach a voluntary settlement before trial begins. Why? Because of everything I just described. Litigation is time-consuming and expensive. It costs a great deal of money, time, and emotional involvement. Most Courts strongly encourage parties to attend either a mediation or a mandatory settlement conference in hopes of resolving the conflict among themselves.
So maybe removing a Trustee is not so “easy,” but it’s not impossible. You just have to follow the steps and don’t stop until your done.