In the high-stakes world of trust and estate litigation, the appointment of a fiduciary, whether an executor, trustee, or administrator, is a powerful and trusted role. But what happens when that fiduciary fails to meet their obligations? What if their actions or inactions threaten the estate, the beneficiaries, or the business interests involved?
New York law provides mechanisms for the suspension, modification, or removal of fiduciaries who are unfit or unwilling to properly serve. For business owners and high-net-worth individuals involved in complex family or business disputes, understanding these legal tools is critical to protecting their interests and their assets.
The Legal Framework: SCPA §§ 711 and 719
Under New York Surrogate’s Court Procedure Act (SCP), fiduciaries can be removed for a variety of reasons. SCPA § 711 requires a petition and notice to the fiduciary, while SCPA § 719 allows for removal without notice in more urgent or clear-cut situations.
Fiduciaries may be removed if they:
- Mismanage estate or trust assets
- Fail to comply with court orders
- Mix personal and estate funds
- Engage in dishonesty or demonstrate poor judgment
- Refuse to communicate or cooperate with co-fiduciaries or beneficiaries
- Are convicted of a felony or declared incompetent
- Create deadlock that halts administration of the estate or trust
Importantly, even in instances where fiduciaries are family members or originally nominated in a will or trust, the courts can and will intervene if the fiduciary's actions threaten proper administration of the estate or trust.
When Conflict Becomes a Liability
In many high-value estates, co-fiduciaries are appointed—often siblings or other relatives—who must work together to manage and distribute assets. While disagreement alone is not enough to justify removal, persistent non-cooperation, hostility, or refusal to act can paralyze administration and result in court intervention.
In one situation, a co-fiduciary refused to cooperate in filing estate tax returns, leading to IRS penalties and even causing a bank to freeze estate accounts. Another example involved a trustee who refused to distribute funds to beneficiaries unless they agreed to her demands regarding alleged overfunding of their trusts. In both cases, courts found such conduct to be contrary to the fiduciary’s legal duty—and removed the offending fiduciaries to protect the estate.
Removal Without Warning
In more urgent scenarios, SCPA § 719 empowers the court to remove or suspend a fiduciary without formal petition. This might happen where:
- A fiduciary absconds or refuses to appear in court
- There’s a felony conviction
- Estate funds are commingled with personal accounts
- A fiduciary fails to file required accounts or comply with court orders
These provisions exist to protect beneficiaries and ensure estate or trust assets are preserved, not drained or delayed due to mismanagement.
Protecting the Estate and Your Future
If you're involved in a dispute over an estate, trust, or business interest and a fiduciary is causing unnecessary delays or losses, you may have legal recourse. These issues can arise in the context of business succession plans, blended families, intra-family business disputes, or poorly managed trusts, especially when the assets include real estate, closely held business interests, or large investment accounts.
At The Glennon Law Firm, we help clients take action when fiduciaries jeopardize the interests of an estate, a trust, or its beneficiaries. Whether you are a business owner, beneficiary, or co-fiduciary, we can assess whether removal is appropriate and guide you through the court process.
Your wealth, your legacy, and your family’s future shouldn’t be left in the hands of someone who isn’t up to the task. If you're facing these challenges, our litigation team is ready to help, contact us today to discuss your options.
For more information on related issues, consider exploring these articles:
- Advice and Direction: Empowering Fiduciaries to Make Confident Decisions
- Unraveling the Legal Maze: Business Owners and Estate Litigation
- What Happens to Your Business in New York State When You Die?
This blog post is for informational purposes only and does not constitute legal advice. For specific legal counsel, please contact our office directly.