Removing A Trustee in Indiana
The role of trustee is an important one, but it does come with clear duties and responsibilities. If a beneficiary of a trust can show that this person acted outside the bounds of these expectations and legal requirements, a trustee can be removed from an Indiana trust. This question is often presented to an Indiana estate planning or probate administration attorney by beneficiaries of trusts who are concerned that a trustee is not performing as he or she should.
Wondering whether or not a trustee can be removed is a complex issue that requires insight from an experienced and knowledgeable professional. An Indiana estate planning lawyer can help to evaluate your individual case and provide you with further details about whether or not it appears that the trustee has breached his or her role.
Reasons to Remove a Trustee
Not all settlors give enough thought to who will be appointed as a trustee. For this reason, a trustee might be installed in this role and might make mistakes. Concerns about how a trustee is performing can also include concerns presented by beneficiaries that the trustee:
- Has a conflict of interest.
- Is involved in self-dealing or managing or investing assets that are in the best interests of the trustee rather than the best interests of the beneficiaries.
- Has mismanaged assets inside the trust.
- Has failed to follow the terms of the trust document.
A trustee who refuses to abide by the terms of the trust can be removed. If it can be shown that this person acted illegally or egregiously, such as mismanaging assets or supporting their own individual interests, a trustee might have violated his or her fiduciary duties.
Finally, another reason why someone might wish to remove a trustee from an Indiana trust is good cause. This is a general term that refers to many different situations that don't meet the other categories, but could still call for the replacement or removal of a trustee. Any argument that involves the removal of the trustee will require a person to have appropriate evidence about why the good cause method should be used.
Who Can Ask for Removal of a Trustee?
Not everyone has the legal authority to remove someone from an Indiana trust. Trusts are divided broadly into two primary categories; living and testamentary trust. Living trusts are also further divided into irrevocable and revocable trusts. Testamentary trusts do not activate until the death of the settlor, whereas a living trust is active during the settlor's lifetime. For trusts that are active during the settlor's lifetime, the trustees can be removed at any point in time when the person who created the trust decides that this is appropriate.
In certain cases, the terms of a trust might also specifically grant authority to a group of beneficiaries, an attorney, a beneficiary or another individual group to remove the trustee. Beneficiaries can still petition the court for the removal of a trustee, even if authority to remove that person was not explicitly given to them. The trust agreement itself can be turned to as a way to review what is most imperative in terms of whether or not the trustee has violated the law or other expectations in his or her role.
Scheduling a consultation with an Indiana probate attorney or Indiana estate planning attorney can help give you better clarity on whether or not you have grounds to remove a trustee. If you suspect that someone is acting outside of his or her fiduciary responsibility, you must take it upon yourself to prepare for this situation by sitting down with a lawyer and deciding what action to take next.