Acrimony between Co-Trustees can raise significant problems. Co-Trustees each have a duty to participate in the administration of the Trust (PC 16013). A Co-Trustee also has a duty to prevent the other Co-Trustee from committing a breach of Trust, and compel a Co-Trustee to repay damages caused by a breach of Trust. That can be a tall order when dealing with a difficult Co-Trustee.
Let’s start with participation. Each Co-Trustee has an affirmative duty to participate in the administration of the Trust. That makes sense in theory because there is no reason to have two or more Co-Trustees if any of them refuses to participate (might as well just name one Trustee). But in practice it may be difficult for two Co-Trustee to participate, especially if they do not get along. This happens quite a bit when two siblings are appointed as Co-Trustees. There can be (in some families) a built-in animosity between the parties that causes the Trust administration to stand still.
Worse yet, if one Co-Trustee actively tries to exclude the other Co-Trustee from participating, then this duty to participate is impossible to meet. In most cases where two or more Co-Trustees cannot get along, one of them has to go.
This brings us to the next part of the duty, to stop a breach of trust. That can be a real problem when you have a runaway Co-Trustee. Difficult Co-Trustees are not so easy to control, let alone preventing a breach. In most cases, the only way to stop a breach is to file in Probate Court and seek an order against the Co-Trustee. And as long as you continue to be a Trustee, you have an affirmative duty to take action—including Court action—if necessary.
The same is true of a Trustee’s duty to force a Co-Trustee to pay back any damages caused by a breach. In most cases, Court action will be required to accomplish this duty. Most Co-Trustees who cause harm to a Trust are not going to pay for the damage willingly. It does happen at times, but more often it is a lawsuit waiting to happen. But happen it must, because a Co-Trustee has a duty to seek the repayment of damages.
It is not so easy being a Trustee, and that is especially true of Co-Trustees. It is important to know your duties, and then keep a watchful eye on your Co-Trustee.