As we discussed last week, in the context of California trusts, misbehaving trustees and successor-trustees is a common problem with California living trusts.  California law provides that at least initially, most trusts are not under any kind of court supervision.  Accordingly, if a trustee or successor-trustee decides to behave in a manner that constitutes a breach of trust, the beneficiaries must take legal action if they are to succeed in forcing corrective action.  This differs greatly from a will probate which normally occurs under the direct supervision of a probate judge, where the probate judge must pass on and approve the actions of the will executor or administrator pretty much every step of the way.

When beneficiaries believe that a trustee is committing a breach of trust, e.g. refusing to distribute trust assets, self-dealing, secrecy, or just plain inaction, naturally their first step is usually to try and reason with the trustee and work things out.  If this fails, as it often does, the next step is usually for the beneficiary to retain legal counsel in order to petition the court for redress and relief.  Normally this involves bringing a trust petition pursuant to Probate Code Section 17200.  This formally places the trust, and the trustee, under the formal jurisdiction of the court, subject to the Court’s supervision and orders.  So far, so good.  Very commonly when Buffington Law Firm’s trust litigation attorneys begin representing beneficiaries in these situations, the beneficiaries seek the immediate removal of the trustee.  Often or usually the beneficiaries know the trustee and not infrequently have a history with him or her that convinces the beneficiaries that instant removal of the trustee should be the first action that the court takes.  This is understandable.

Not infrequently, the beneficiaries are also correct.  But most often it is the case that the Probate Court will not begin the corrective action by simply suspending the trustee (temporarily removing him or her; such temporary removal often later becomes permanent).  The Probate Judge certainly has the authority to do this, pursuant to California Probate Code Section 17206 and controlling case law.  [Cal. Prob. Code Section 17206; see also e.g. Schwartz v. Labow, 164 Cal. App. 4th 417]. But most times, absent absolutely egregious conduct by a trustee, the Court will first try to order the trustee to take appropriate corrective action before resorting to suspension or removal.  This is because California law gives considerable deference to the choice of successor-trustee by the original trustmaker, and courts are reluctant to change such decision.  This is because the “trustmaker’s intent” is the guiding principle, within limits, that a Court tries to follow, and presumably the choice of trustee in the trust instrument reflects that intent.  [E.g. Schwarz v. Labow, supra; see also Fazzi v. Klein, 190 Cal. App. 4th 1280].  When beneficiaries point out disqualifying backgrounds or history on the part of a successor-trustee, the Court will often or usually assume that the trustmaker knew about these things and appointed the person anyway.  Thus, unless the petitioner can show that a successor-trustee has committed one or more serious breaches of trust after becoming trustee the Court will not effect suspension or removal, at least not initially.  Thus, for example, if a trustee has refused or failed to produce an accounting of the trust when asked by the beneficiaries prior to their petitioning the Court, the Court will usually issue an order to the trustee to do so rather than simply suspending the trustee for his or her earlier failure.  Failure to satisfactorily follow the Court’s own order very likely would then lead to suspension and removal, should that occur.  Of course, commonly trustees will obey a Court order, even if they were unresponsive to the perfectly justified requests for the same thing earlier on by the beneficiaries.

Accordingly, suspending or removing a trustee is often not something that happens right away, sometimes not even in situations where most of us believe that this would be best.  But it can be accomplished in time, if the trustee continues to commit breach of trust.  Buffington Law Firm’s trust litigation attorneys have successfully achieved removal of rogue trustees many times; it just takes persistence and, of course, bad behavior by the trustee.

If you are a trust beneficiary who is struggling with a problem trustee, we invite you to call our Firm for a Free Legal Consultation.  All  consultations are with a qualified and experienced trust litigation attorney, there is never any charge or obligation, and all consultations are completely confidential and protected by attorney-client privilege.  Call us today!