What is a Trustee?
A trustee or co-trustee is a person who is designated as a fiduciary of a trust. In Virginia, a fiduciary is given the great confidence and trust to responsibly manage and maintain financial affairs without letting self-interest affect fiduciary decisions. In the case of a revocable trust, the settlor (person who created the trust), trustee and beneficiary can be the same person who often designates a subsequent trustee who will assume fiduciary responsibilities if/when the settlor is incapacitated or deceased. If the trust is irrevocable, the settlor is not the trustee – another party must be designated, and the settlor has no further control of the trust.
What are the duties of a trustee?
A trustee is trusted to administer the trust and invest trust assets in good faith with a commitment to adhere to the terms and conditions set in the trust with great respect for the interests of the settlor and beneficiaries. The trustee is held to a high standard of conduct necessitating a diligent sense of propriety. Specifically, the trustee must comply with the provisions of the Virginia Uniform Prudent Investor Act (§ 64.2-780 et seq.) and the Virginia Uniform Principal and Income Act (§ 64.2-1000 et seq.).
What can you do if a trustee is not living up to well established standards?
In Virginia, if you see a situation where a trustee fails to administer the trust effectively or has disregarded the terms of the trust acting independently, there are legal options to help rectify the situation. A settlor, co-trustee, or beneficiary can petition the court to remove a trustee (Va. Code § 64.2-759). The court can remove a trustee if the trustee has committed a breach of trust, shows a lack of cooperation with co-trustees impairing the administration of the trust, or is unfit (either self-proclaimed or as determined by the court). The final scenario requiring trustee removal is a substantial change of circumstances. The court always takes into account what best serves the interests of all beneficiaries.
Litigation, filing a petition with the court, to remove a trustee may be your best course of action to protect trust property and the interests of the beneficiaries. If you question the administration of a trust, an experienced litigation attorney is essential to quickly and efficiently intervene.
Trust & Estate Litigation | Ryan C. Young | Richmond, Virginia Attorney