Miscellaneous

Question 1

Multiple Trustees

Answer 1

Powers vested in three or more trustees can be exercised by a majority of trustees.

Trustee who does not join in exercising power is not liable for the consequences of the exercise if he expresses dissent

Question 2

Resignation and Removal of Trustee

Answer 2

Resignation: Trustee may resign pursuant to the terms of the trust agreement (need court approval if no provision in trust agreement)

Removal: any interested party can petition the court to remove a trustee who has violated a term of the trust resulting in material financial loss to the trust or who has become incapacitated or insolvent.

Question 3

Appointment of a Successor Trustee

Answer 3

If no successor trustee is selected pursuant to trust instrument, the power to appoint a successor trustee vests in the court.

Successor trustees should have same power as predecessors unless trust instrument or court order says otherwise.

Question 4

Liability of Successor Trustee for Breach by Predecessor

Answer 4

Successor trustee not liable for breach by prior trustee unless he knew or should have known of the breach and did not take reasonable steps to fix it.

Question 5

Trust advisor

Answer 5

Settlor can appoint to serve as a watchdog over the trustee or as a power holder to do things a trustee may have a hard time justifying governed by fiduciary duties

Trustee who acts reasonably according to trust advisor’s advice not liable for doing so.