Removing a Fiduciary in New York: Understanding the Process

A fiduciary is a person or entity that is appointed to manage the assets and affairs of another person or entity, known as the principal or beneficiary. Fiduciaries are held to a high standard of care and must act in the best interests of the principal or beneficiary. In some cases, it may be necessary to remove a fiduciary if they are not fulfilling their duties properly.

In New York, the process of removing a fiduciary typically begins with a petition to the court. The petitioner, who is usually a beneficiary or co-fiduciary, must provide evidence that the fiduciary has breached their duties or is otherwise unfit to continue in their role. Grounds for removal may include mismanagement of assets, conflicts of interest, dishonesty, incompetence, or neglect.

Once the petition is filed, the court will schedule a hearing to consider the evidence and determine whether the fiduciary should be removed. At the hearing, both the petitioner and the fiduciary will have the opportunity to present their arguments and evidence. The court will consider factors such as the fiduciary’s performance, the best interests of the beneficiary, and any potential harm that may result from removing the fiduciary.

If the court determines that the fiduciary should be removed, it will issue an order to that effect. The court may also appoint a successor fiduciary, who will take over the management of the assets and affairs of the principal or beneficiary. The successor fiduciary may be someone who was named in the original trust document or appointed by the court.

Removing a fiduciary can be a lengthy and expensive process. It may involve hiring attorneys, accountants, and other professionals to gather evidence and present arguments in court. In addition, there may be fees and costs associated with appointing a successor fiduciary. Therefore, it is important to carefully consider all options before deciding to pursue the removal of a fiduciary.

In some cases, it may be possible to avoid the need for court intervention by resolving disputes through alternative methods, such as mediation or arbitration. These methods can be less costly and time-consuming than going to court and may also help to preserve relationships among family members or co-fiduciaries.

In conclusion, removing a fiduciary in New York can be a complex and difficult process that should only be undertaken after consultation with legal and financial professionals. If you believe that a fiduciary is not fulfilling their duties properly, it is important to gather evidence and seek the advice of an attorney who specializes in trust and estate litigation. With proper guidance and support, you can protect the interests of the principal or beneficiary and ensure that the assets and affairs of the trust are managed appropriately.

If you are concerned about the actions of a fiduciary or you are a fiduciary and need guidance on your legal obligations, call us for a consultation.