Like estate executors, trustees have fiduciary responsibilities. A trustee’s chief responsibility is to manage the assets in a trust according to the instructions of the person who established that trust (the settlor or creator). They have a duty to act in the best interests of the trust’s beneficiary(ies) in accordance with the law.
The specific duties of a trustee depend on the type and purpose of the trust. For example, a parent may designate that an adult child’s inheritance be placed in a “conditional” or “spendthrift” trust if they don’t believe that child can responsibly handle a direct inheritance. The trustee may be directed to give the beneficiary a specific amount each year, beginning at a particular age or for specified purposes (like education or a home purchase). Sometimes, a trust creator will designate that they want their money or other assets to increase in value to provide regular income to the beneficiary. That requires making sound investments and managing trust funds carefully.
When can a trustee be removed under Oregon law?
It’s not uncommon for people to take legal action against a trustee – even a family member like a sibling or stepparent. If you’re considering this course of action, it’s crucial to know that Oregon law has requirements for when a beneficiary or co-trustee may ask a court to remove a trustee or when a court can take that action on its own. Amont the reasons this can be done are the following:
- There’s been a “serious breach of trust” by the trustee.
- A trustee is determined to be “unfit or unwilling, or has persistently failed to administer the trust effectively.”
- There’s been a “substantial change of circumstances.”
- The inability of co-trustees to work together “substantially impairs the administration of the trust.”
Basically, a trustee can be removed by a court if it’s determined that doing so is in the beneficiary(ies)’ best interests.
Do you believe that either your co-trustee or the trustee of a trust for which you’re a beneficiary should be removed? By seeking experienced legal guidance, you can determine whether you have valid grounds and, if so, work to make a strong case.