Reed was injured in two different automobile v. individual accidents. A special needs trust was established to hold a home and funds from the resulting litigation.
Ultimately, the trustee was replaced by the public guardian as temporary trustee. The public guardian was replaced by a professional fiduciary who was appointed temporary successor trustee. After a series of hearings and continuances, with the family, the trust beneficiary, and the public guardian all suggesting that the conservatorship was no longer necessary and that a family member could act as trustee, all opposed by the professional fiduciary, the trial court appointed the professional fiduciary as permanent trustee. The trial court cited California Probate Code sections 15642, subdivision (e), and 17206 as authority for the court to award fees in spite of the specific prohibition of fees to a successor trustee in the trust, and the trial court awarded fees to the successor trustee – the professional fiduciary.
The Court of Appeal, Sixth Appellate District, reversed the trial court and held that there was no authority for a court to award fees to a successor trustee who accepted appointment as trustee and acted in that capacity, but could have declined the appointment, where the trust itself restricted the amount to be paid or prohibited it. The Court pointed out that the trial court’s ruling was contrary to the plain language of California Probate Code section 15680, which limits trustee compensation to the amount fixed by the trust.
John T. Anderson, Section Chair
LB Bar Assoc. Estate Planning, Trust, and Probate Law Section
Certified Specialist in Estate Planning, Trust, and Probate Law by the
State Bar of California Board of Legal Specialization