Termination of a trusteeship

All things come to an end, and the appointment of a trustee is no different. At some point, the trustee will end his relationship with the trust. This end can be voluntary, enforced or by operation of law.

Disclaimer

As a general rule, no person can be compelled to be a trustee against his will. Thus, a person appointed as trustee may disclaim the office at any time before acceptance. In the interim, if he does anything tending to show that he has accepted the trust, such as interfering with the trust property, his intention to disclaim may be disputed.

The disclaimer may be express or implied. Where express, it may by deed and where implied, it may be apparent from apathy (refusal to act) if the apathy is consistent. See RE: CLOUT & FREWER’s CONTRACT (1924) 2 Ch. 230.

The disclaimer must be made timeously though. If the person disclaiming was sole trustee, legal title in the trust property reverts to the settlor or his personal representative until a new trustee is appointed.

The exception to right of disclaimer is in constructive or resulting trusts. In these instances, the trustee has no option to disclaim.

Retirement

Generally, a trustee cannot retire. It’s a life office and he’s in it for the long haul. However, he may retire in appropriate circumstances. These include:

  • Provision in the trust instrument
  • Under statutory provision e.g. s. 24 Trustee Law allows a trustee to declare by deed that he desirous of being discharged from the trust provided that there will be at least two trustees left. However, the remaining trustees and the person empowered to appoint new trustees must consent to the discharge.
  • By authority of the court. This may be in consequence of s. 25 Trustee Act or under the inherent powers of the court. The court may also impose whatever conditions it sees fit before the retirement can take effect, such as requiring reasonable grounds for retirement of the trustee.
  • By consent of the beneficiaries. It must be unanimous consent.

Removal

A trustee can be removed from his office in any one of the following ways:

  • Under a power contained in the trust instrument. It must be for the reason and in the manner specified.
  • Under statutory provisions e.g. where the trustee remains outside Nigeria for up to 12 uninterrupted months, as provided by s. 10 Trustee Act and s. 24 Trustee law or where he refuses, or is incapable of acting.
  • By order of the court under s. 25 Trustee Act (if the continued acting of the trustee will be detrimental to the trust [breach of trust]) or in consequence of the inherent powers of the court. See ADESEYE v WILLIAMS (1964) 2 All NLR 37 where the beneficiaries alleged that the trustees were not in accord. Although, the court found that the trustees were in accord, it held that “a trustee will be removed if the court is satisfied that his continuance in office will be prejudicial to the performance of the trust and to the interest of the beneficiaries, or if the trustee has disregarded his duties.” Also, in REMMER v REMMER (1961) 1 All NLR 233 the court granted an application to remove a trustee on the ground incompetence due to ill health. See also ADEMOLA v SODIPO (1992) 7 NWLR 251 where the trustee was alleged to be impartial.

Death

Death brings an end to all things, including trusteeship. If the trustee was acting alone, the trust property devolves on his personal representative who is also free to accept or reject the office. However, in the states formerly in the western region, the personal representative is obligated to act as trustee until another is appointed. See s. 10(12) Trustee Law

If there is more than one trustee, the trust estate devolves on the surviving trustees in consequence of the rule of jus accrescendi (right of survivorship).

Author: Opeoluwa Sanni

Ope likes simple things and loves making things simple. He’s passionate about his business (whatever that is) and always looks to stand out.

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