In the recent English case of Baynton-Williams v Baynton-Williams a man moved into his late mother’s home against the wishes of his brother and joint executor. The High Court of England and Wales granted an order removing him as an executor and ordering him to account for the rent that should have been paid for his occupation of the property. This blog considers what steps can be taken to remove a trustee or executor in Scotland.
Executors under a will, and trustees under a trust, are in a powerful position. They are chosen as people who can be trusted to implement the terms of the will or the trust deed. This then makes it very difficult to remove an executor or a trustee, as it is assumed they are the right person for the role. Without their agreement to resign, an executor or trustee can only be removed by the court.
There are two ways in which the court can remove an executor or trustee.
1. Removal of executors/trustees by the court under statute
Under the provisions of the Trusts (Scotland) Act 1921, any person with an interest in the trust estate (including executors, trustees and beneficiaries) may make an application to the Court of Session or the Sheriff Court to have a trustee removed if a trustee:-
i. Becomes insane; ii. Becomes incapable of acting by reason of physical or mental disability; iii. Is continuously absent from the UK for a period of six months or more; or iv. Has disappeared for a period of six months or more.
If insanity or incapacity are proved, the court has no discretion and must remove the trustee. If removal is sought on the grounds of absence from the UK or disappearance, the court has discretion to decide whether or not to remove the trustee. The court may find absence from the UK less problematic than it was in 1921.
These grounds for removal are not likely to be helpful where the executor or trustees is delaying, or being difficult, or where a dispute arises with his co-executor/trustees or with the beneficiaries. This makes the court’s other option important.
2. Removal of executors/trustees by the court under common law
The Court of Session has inherent discretion under the common law to remove an executor or trustee through the exercise of the nobile officium (the noble office or duty of the Court of Session). The nobile officium is an equitable jurisdiction where the court may, within limits, mitigate the strictness of the law and provide a legal remedy where none exists. Application may be made by any one or more of the trustees and/or the beneficiaries.
The court rarely exercises its discretionary power to remove executor/trustees in this way. It tends to do so only if there is no other option available and it is satisfied that “the continuance in office of the trustee concerned would be likely to prejudice or obstruct the due execution of the trust purposes”. Constant disregard or refusal by a trustee to carry out their duties to the prejudice of the trust administration has resulted in a trustee’s removal by the court. However, the court will not remove a trustee simply because of minor irregularities or disagreement or disharmony between the executors/trustees. The key consideration for the Court is protecting the beneficiaries.
Removing trustees can be a complex and time-consuming process. Ultimately, being a trustee is a matter of trust and it is important that the correct persons are appointed and assumed to act as trustees to avoid issues around removing trustees.