Trustees—removal of trustees

The following Private Client practice note provides comprehensive and up to date legal information covering:

  • Trustees—removal of trustees
  • Express power in the trust instrument
  • Removal and replacement under section 36(1) of the Trustee Act 1925
  • Appointment by the court under section 41 of the Trustee Act 1925
  • Inherent jurisdiction
  • Compulsory retirement
  • Compulsory removal of incapable trustee

Trustees—removal of trustees

A trustee may be removed against their will in any of the following ways:

  1. under an express power in the trust instrument

  2. under section 36(1) of the Trustee Act 1925 (TA 1925)

  3. by court order under TA 1925, s 41

  4. by direction of the beneficiaries under section 19 of the Trusts of Land and Appointment of Trustees Act 1996 (TOLATA 1996)

Removal is not a step to be taken lightly. Misconduct is not necessary: friction between the trustees may be sufficient ground, although a dispute between the trustee and the beneficiaries over the manner in which the trustee exercises their discretion will not generally suffice but may be taken into account. The main consideration will always be the beneficiaries' welfare.

Express power in the trust instrument

Although TA 1925, s 36(2) expressly contemplates the existence of a power to remove trustees, in practice it is rare for a domestic trust instrument to incorporate an express power of removal (but they are common in offshore settlements). Most commonly, such a power will arise in the context of a commercial transaction.

If it exists, an express power to remove a trustee can only be exercised in strict accordance with its terms as to:

  1. the circumstances in which the power becomes exercisable

  2. the identity of the person who may exercise the power (most likely the settlor)

  3. the manner in

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