CG33351 - Trustees: retirement or removal of trustees
In England and Wales trustees generally retire or are removed from office in the following circumstances.
- Under an express power in the deed.
- Under Section 36(1) Trustee Act, where one wishes to be discharged and a new one is appointed.
- Under Section 36(1) Trustee Act, where one refuses to act, or is unfit or incapable of acting, or is outside the UK for 12 months. It is however quite common, particularly in cases where it is intended, in order to avoid tax, to move the trust abroad, for a specific clause of the trust deed to override this provision.
- Under Section 19 Trusts of Land and Appointment of Trustees Act 1996, where the beneficiaries of the settlement “are of full age and capacity and are (taken together) absolutely entitled to the property subject to the trust” and give notice to an existing trustee to retire.
- Under Section 39 Trustee Act, where one wishes to be discharged, and after the discharge there will be at least two individual trustees or a trust corporation remaining, and they consent to the discharge.
As a general rule a trustee cannot be discharged unless as a result there would be at least two individuals or a trust corporation in office. A foreign company cannot be a trust corporation.