When the Court can appoint a new Trustee for your Trust

September 27, 2013

in Trusts

Estates & Wills


Many people may not be aware that the Court has both inherent power and Statutory power to appoint a new trustee or trustees in various situations.  Specifically where a trustee has:


  • misconducted themselves in the administration of the Trust
  • been convicted of a crime involving dishonesty
  • becomes mentally disordered
  • is subject to a protection order
  • been declared bankrupt
  • or if a Company, where the Company has ceased to carry on business.

There is also a general power to replace Trustees and the Courts have replaced Trustees in circumstances when there is ongoing conflict and entrenched positions being taken by Trustees and to avoid such unnecessary aggravation Corporate Trustees have been appointed in their place.

The Statutory power of the Court is derived from section 51 of the Trustee Act 1956 and the Courts, through a number of cases, have confirmed that they will look to the express or implied intentions of the Settlors but emphasise that there should be neutrality between the beneficiaries and they will exercise the power to remove trustees to promote the purposes of the Trust.

The impartial administration of the Trust is the critical issue.  This power can only be exercised by the High Court and is an expensive exercise but it is a helpful remedy in situations where there is conflict between Trustees which cannot be resolved any other way.

It is therefore critical to take legal advice and sound counsel before engaging in Trust issues and disputes between trustees and Farry and Co. are experts in this area and can advise you in all aspects in relation to Trust matters.

If you require any advice or further information on the matters dealt with in this publication please contact the lawyer at Farry and Co. who normally advises you, or alternatively contact:

Michael Nidd


03 477 8870 or 09 379 0055


The information contained in this publication is intended as a guide only.  It does not constitute legal advice and should not be relied upon as such.  Professional advice should be sought before applying any of the information to particular circumstances.  While every reasonable care has been taken in the preparation of this publication, Farry and Co. does not accept liability for any errors it may contain. 

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