Removal of Executors and Trustees

Executor’s Duties

The Executor and a trustee stand in a fiduciary relationship to the estate and the beneficiaries.[1] The standard of duty owed by ‘lay personal representatives,’ is that of ‘an ordinary prudent businessperson.’[2] Executors and Trustees must act prudently and properly in the management of the estate as a whole.[3]An executor must not suffer the estate to be injured by their neglect or careless administration or prefer their own interests to those of the estate.

Court’s Power to Remove Executor

The court has inherent jurisdiction to remove an executor and trustee and appoint a replacement.[4] The court also has statutory power to remove a trustee under s77 of the Trustees Act 1962 (WA). The jurisdiction to remove an executor or trustee is not simply whether the trustee has committed breaches of trust, but the welfare of the beneficiaries.[5]

As Dixon J stated in Miller v Cameron (1936) 54 CLR 572 at 580 -581:

“The jurisdiction to remove a trustee is exercised with a view to the interests of the beneficiaries, to the security of the trust property and to an efficient and satisfactory execution of the trusts and a faithful and sound exercise of the powers conferred upon the trustee. In deciding to remove a trustee the Court forms a judgment based upon considerations, possibly large in number and varied in character, which combine to show that the welfare of the beneficiaries is opposed to his continued occupation of the office. Such a judgment must be largely discretionary. A trustee is not to be removed unless circumstances exist which afford ground upon which the jurisdiction may be exercised. But in a case where enough appears to authorize the Court to act, the delicate question whether it should act and proceed to remove the trustee is one upon which the decision of a primary Judge is entitled to especial weight.”

[1] Williams v Williams 2004 QSC 269.

[2] Re Speight (1883) 22 Ch D 727 at 739-740; Austin v Austin (1906) 3 CLR 516 at 525 per Griffith CJ.

[3] Re Charteris [1917] 2 Ch 379 at 389.

[4] Monty Financial Services Ltd v Delmo [1996] 1 VR 65, Phelan v Booth (1941) 43 WALR 60; Porteous v Rinehart (1999) 19 WAR 495; See v Hardman [2002] NSWSC 234.

[5] Meyers CJ in Hunter v Hunter [1938] NZLR 520 at 530.

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