Who Decides Who Serves as Successor Trustee?

When a trust is written, the settlor (person creating the trust) chooses someone to serve as successor trustee.  Often the settlor will choose a few or several people, and they are named in order in the trust.

Take, for example, the case of May, a widow who lives in San Diego.  May creates a trust and selects her oldest daughter to serve as successor trustee.  May also lists her two other children as second and third choice to serve.

After the settlor dies, the first person nominated serves as successor trustee.  But remember, you can’t be conscripted into serving!  The person nominated must be willing and able to serve.  Even if she simply does not want to take on the duties of trustee, she can decline.

Going back to the case of San Diegan May, after she dies, her oldest daughter learns that she is successor trustee.  But let’s say the oldest daughter, for whatever reason, does not feel capable or able to serve.  If she declines, then the next person nominated is asked to serve as successor trustee.  In May’s case, that would be her middle child.  And if the middle child cannot do it, then the third person nominated in the trust is asked to serve.

If the list is exhausted and there is nobody with the ability to serve, what happens?

First, look to whether there is someone with the ability to nominate a successor trustee.  Perhaps by the time May dies, out of her three children, only one is living, and she does not feel capable of serving.  She would have the ability to nominate a successor trustee:  a family member, friend, or private fiduciary, for example.

If there is nobody with the power to nominate a successor trustee, a beneficiary under the trust can file a petition in probate court asking to nominate someone.  The beneficiary can ask to serve himself, or can nominate someone else.  The reason this has to be done through a court order is that the successor trustee will be dealing with various financial institutions, and that is what they will require before working with the newly nominated successor trustee to carry out the terms of the trust.

Trustee (noun):

A person or organization that has been given responsibility for managing someone else’s property or money through a Trust. There are different types of trusts, including Totten Trusts, Special Needs Trusts, Testamentary Trusts, Living Trust, and many others. The type of trust will determine the exact actions a Trustee must take in order to perform their job.

Petition (noun):

A formal written request made to a Court in order to ask for some type of relief. It can be for made for many things, anything that someone is asking the Court to do can have some type of Petition filed. An example is a Petition to Probate a Will, this is usually submitted with the will to the Court to request the Executor be given the formal power to carry out the Will.

 

 

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Scott Grossman

Scott Grossman

Attorney

The Grossman Law Firm, APC · 525 B Street, Suite 1500, San Diego, CA 92101 · (951) 523-8307
 

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