Table of Contents
Understanding Co-Trustees’ Roles
Core Responsibilities of Co-Trustees
4. Cooperating and Acting in Good Faith
What Happens When Co-Trustees Disagree
When to Involve a Trust Litigation Attorney
How The Grossman Law Firm Can Help
Key Takeaways
- Co-trustees must act jointly and in the best interests of all beneficiaries.
- California law requires co-trustees to agree on major trust decisions unless the trust gives one trustee sole authority.
- Failing to cooperate or mismanaging trust assets can result in personal liability and even lead to removal by the court.
- The Grossman Law Firm represents beneficiaries and co-trustees throughout California in trust disputes and cases involving fiduciary breaches.
Understanding Co-Trustees’ Roles
When a California trust names more than one trustee, those trustees must serve together in managing, protecting, and distributing the trust’s assets. On paper, having multiple trustees can seem like a safeguard, ensuring checks and balances and preventing the misuse of power.
In practice, however, co-trustee relationships often become strained when communication breaks down or one trustee refuses to cooperate.
At The Grossman Law Firm, we frequently represent clients involved in these situations—either beneficiaries harmed by trustee misconduct or co-trustees attempting to navigate their legal obligations under the California Probate Code.
Core Responsibilities of Co-Trustees
Co-trustees share the same fiduciary duties as a single trustee: loyalty, impartiality, prudence, and transparency. However, when multiple trustees serve together, each is equally responsible for ensuring the trust is administered correctly.
1. Managing Trust Assets
Under Probate Code §16006, trustees must take reasonable steps to manage, preserve, and make trust assets productive. For co-trustees, this means:
- Opening and closing trust accounts jointly.
- Making investment decisions that align with the California Prudent Investor Rule (Probate Code §16047).
- Maintaining accurate records and providing accounting to beneficiaries.
- Ensuring all transactions are documented and transparent.
If the trust instrument assigns management authority to one trustee, that individual still owes a duty to keep the other co-trustees informed. When the trust is silent, both must act together and agree on all asset-related actions.
2. Filing Trust Taxes
Trustees must ensure that all federal, state, and local taxes are filed correctly and on time. It includes:
- Income taxes for the trust itself.
- Estate taxes, if applicable.
- Property taxes or capital gains related to trust property.
Unless the trust document specifies otherwise, co-trustees are equally responsible for ensuring tax compliance. They may delegate technical work to a CPA or tax attorney, but they cannot delegate accountability. A missed filing or underpayment can expose both co-trustees to personal liability.
3. Distributing Trust Assets
Once debts and taxes are settled, the trustees must distribute the remaining assets in accordance with the terms of the trust. This process may involve:
- Liquidating or transferring property.
- Making direct payments to educational institutions or care providers for beneficiaries.
- Managing ongoing support for minor or disabled beneficiaries.
Even if only one trustee handles the paperwork, all co-trustees remain legally responsible for ensuring distributions are correct and completed promptly. If one trustee delays or withholds assets, beneficiaries can petition the probate court to compel distribution under Probate Code §17200.
4. Cooperating and Acting in Good Faith
Perhaps the most essential duty for co-trustees is cooperation.
California law expects trustees to act jointly unless the trust document clearly allows otherwise. Each must:
- Communicate regularly with the other co-trustees.
- Share information and documents relevant to trust administration.
- Avoid conflicts of interest or actions that benefit one trustee over the others.
A breakdown in cooperation can lead to severe delays and potential legal disputes. Suppose one trustee refuses to participate or acts against the interests of beneficiaries. In that case, the court can suspend or remove that trustee under Probate Code §15642.
What Happens When Co-Trustees Disagree
Disagreements between co-trustees are common, especially when personal relationships or family dynamics are involved. Common sources of conflict include:
- Disputes over whether to sell or retain real estate.
- Differing opinions about investment risk.
- Lack of transparency in accounting or decision-making.
- One trustee refuses to sign the necessary documents.
If the trustees cannot resolve their differences, California Probate Code §17200(b)(6) allows either trustee to petition the probate court for instructions. The judge may authorize one trustee to act alone, appoint a neutral third party, or remove a trustee whose conduct harms the trust.
When to Involve a Trust Litigation Attorney
If you are a co-trustee facing uncooperative behavior—or a beneficiary whose interests are suffering because co-trustees cannot work together—don’t wait for the situation to worsen.
An experienced California trust litigation attorney can help you:
- Interpret the trust document to determine the powers of each trustee.
- Petition the court for directions or to remove a negligent trustee.
- Compel accountings or trust distributions.
- Protect your rights as a beneficiary or fiduciary.
The longer a dispute goes unresolved, the greater the risk to the trust’s assets and beneficiaries.
How The Grossman Law Firm Can Help
For over 20 years, The Grossman Law Firm has represented California beneficiaries and co-trustees in complex trust and probate litigation. We help clients:
- Enforce co-trustees’ fiduciary duties.
- Compel cooperation or remove unfit trustees.
- Recover damages for breaches of trust.
- Navigate California’s Probate Code requirements with confidence.
Our firm focuses exclusively on probate, trust litigation, and probate litigation. If you’re struggling with a co-trustee who won’t communicate, sign, or act in good faith, we can help you take decisive legal action.
Call (888) 443-6590 or fill out our Get Help Now form.
Our Intake Specialists can evaluate your case at no cost to you to assess your situation. Qualifying cases will be scheduled for a Free Phone Consultation with Attorney Scott Grossman.
Related Resources
- Overview of California Trust Litigation
- 20 Ways Your Trustee Can Be Breaching Their Fiduciary Duties
- Know What You’re Getting Into: The Timeline of a Trust and Estate Lawsuit
- Can a Trustee Be Removed for Mishandling Assets?
- Can’t Afford a Probate or Trust Attorney?
FAQ
What happens if one co-trustee refuses to act?
If a co-trustee refuses to participate, the other trustee may petition the probate court for authority to act alone or to remove the inactive trustee under Probate Code §15642.
Can one co-trustee make decisions without the other?
Only if the trust instrument explicitly allows it. Otherwise, all co-trustees must act together when managing or distributing trust assets.
Are co-trustees personally liable for each other’s mistakes?
Yes. Under California law, both trustees can be held personally liable if one fails to fulfill their fiduciary duties and the other fails to prevent or correct the breach.
What if co-trustees live in different states?
They must still work together and communicate regularly. Remote administration is possible through coordinated documentation, virtual meetings, and proper record-keeping—but both remain equally accountable to the beneficiaries.
Originally Published Oct 5, 2022