Removal of Corporate Trustees under the Uniform Trust Code and Other Current Law: Does a Contractual Lense Help Clarify the Rights of Beneficiaries

In this Article, we hope to show that viewing trust law through a contractual lense may illuminate the problem of beneficiary removal of a corporate trustee. In part, this lense of help clarify by examining the recent reforms in American trust law (as seen in the UTC and Restatement (Third) of Trusts), as well as the contractual approach of European civil law jurisdiction and their recent attempts to move beyond it. Along the way, we will explore what rights the trust deal may provide beneficiaries in the trustee removal area. For example, a corporate trustee performs certain non-personal duties that are associated with the office of the trustee.

These duties, particularly those involving investment of trust assets and administration, are a primary focus of the trust deal and generally may be accomplished by any other corporate trustee. Perhaps, the settlor’s trust deal contemplated that beneficiaries should have the right to transfer a trust from on corporate trustee to another of their choosing if the can convince the court that this change would be in their best interests. A corollary of this interpretation might be that such a change would not contravene any material purpose of the settlor.