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Co-Trustees
We have spent countless hours listening to customers contemplate on who they should choose as the Successor Trustee, especially with blended families that have different political views, social values, skill sets, and personalities, so they appoint often times appoint successor Co-Trustees.
Read below to see what these attorneys have to say on the subject of appointing Successor Co-Trustees:
IS APPOINTING MORE THAN ONE TRUSTEE A GOOD IDEA?
“As the Settlor, you have the freedom to select any individual as the Trustee, and you can even appoint multiple Co-Trustees. People often choose Co-Trustees for various reasons, such as:
· Avoiding potential conflicts among adult children by appointing multiple Co-Trustees.
· Combining a family member’s trust with a professional’s expertise, balancing trust and practical guidance.
· Believing that Co-Trustees can provide mutual support and act as a built-in “sounding board.”
While these are valid reasons for appointing Co-Trustees and can be considered advantages, there are important disadvantages to consider as well, including:
· Co-Trustees are entitled to fees, leading to higher administration costs as more Trustees are involved.
· Multiple Trustees can result in delays if unanimous agreement is required before taking any action.
· An even number of Trustees may lead to decision-making gridlock if they cannot reach a consensus.
· Appointing family members as Co-Trustees can inadvertently generate family conflicts.
· The combination of a professional and a non-professional Trustee muddies the proverbial waters. To avoid this, consider naming a family member as the primary Trustee and allowing them to hire an attorney and/or financial advisor to provide guidance during trust administration.
Ultimately, the choice of Co-Trustees or a single Trustee depends on your specific circumstances, goals, and the dynamics of your family or trust beneficiaries. It is essential to carefully weigh the advantages and disadvantages to make the most appropriate decision for your trust.”
Scott Schomer, Estate Planning Attorney
SchomerLawGroup.com
November 7, 2023
Accessed April 9, 2024
CAN A CO-TRUSTEE ACT ALONE?
“The answer to this is No unless the Trust document states otherwise. In the case where the Trust does not explicitly state, the Trustee and the co-trustee should make all decisions unanimously to push the trust administration process forward.”
Hess Verdon, A professional Law Corporation
Hessverdon.com
Accessed April 9, 2024
JOINT VS. INDEPENDENT ACTION
Joint Action
Joint action means that co-trustees must unanimously agree on decisions related to the trust. They are required to consult with each other and reach a consensus before making any decisions. Joint action can lead to more balanced and informed decisions, as each trustee brings their own perspective and expertise to the table.
Independent Action
Independent action allows co-trustees to make decisions without the consent of the other co-trustees. In some cases, this might be necessary for the efficient administration of the trust, but it can also lead to disagreements and conflicts among the co-trustees.
Hess Verdon, A professional Law Corporation
Hessverdon.com
Accessed April 11, 2024
<https://hessverdon.com/when-do-co-trustees-have-to-act-jointly-in-california/>