Ch 07 - Trustees - Appointment, Removal and Retirement

Question 1

Who are the initial trustees of a trust?

Answer 1

The initial trustees are appointed by the settlor and are typically identified in the declaration of trust.

Question 2

How can trustees retire and be replaced?

Answer 2

A trustee can retire without replacement if two trustees or a trust corporation remain. If fewer than two trustees remain, a new trustee must be appointed in writing.

Question 3

Is a formal deed necessary for trustee appointments?

Answer 3

It is better to formalize the appointment through a deed, as it automatically vests trust property in the new trustee.

Question 4

How can a trustee be removed?

Answer 4

Continuing trustees can remove a trustee in cases like death or absence for 12 months. The removal must be in writing and is often formalized by a deed.

Question 5

Can the court remove a trustee?

Answer 5

Yes, the court can remove a trustee and appoint a replacement if it is expedient, difficult, or impractical to do so otherwise, but maladministration must be proven.

Question 6

When can beneficiaries remove a trustee?

Answer 6

Beneficiaries who are absolutely entitled to the trust fund can remove a trustee in writing, as long as they are of full age and capacity.

Question 7

How can additional trustees be appointed?

Answer 7

Continuing trustees can appoint additional trustees in writing or by deed, but no more than four trustees are allowed.

Question 8

Can a trustee appoint a deputy?

Answer 8

Yes, a trustee can appoint an attorney (deputy) for up to 12 months, but the trustee remains vicariously liable for the attorney’s actions.