Creating a trust is intended, among other things, to secure one’s assets and beneficiaries against the unexpected. However, even trusts depend on humans to function, and a trustee who no longer wishes to serve may create an unexpected wrinkle in an estate plan. It is wise to make sure that any trust you establish or serve has defined terms for how a trustee may resign, to avoid unnecessary complications if this occurs. In California, a trustee retains the right to resign, but must first meet some requirements.
First and foremost, the trustee should consult the terms of the trust document. If the document lays out the steps a trustee must take to resign, and those steps do not create any further legal conflicts for the trustee (such as requiring that he or she do something ethically or legally questionable), then the trustee must follow the terms laid out for resignation.
In the absence of such terms, the trustee may either obtain the consent of the trust creator (for revocable trusts) or address the issue with all adult beneficiaries (for irrevocable trusts). If these steps are not successful, the trustee can petition the court to allow him or her to resign. After the resignation is complete, the trustee must provide comprehensive records of all transactions he or she oversaw in administering the trust to any beneficiaries who want them.
If you wish to resign as a trustee, it is wise to speak with an attorney to ensure that you fully understand the terms of the trust and the steps you should take to most effectively resign your duties. Estate planning conflicts can often create surprising complications, so it is always wise to perform due diligence and ensure that your rights remain protected as you seek to leave your position as a trustee.
Source: SCCourts.org, “PROBATE TRUSTS,” accessed July 28, 2017
