New Trustee by court
1. Introduction:
The court can appoint a trustee under the Trusts Act. In appointing new which not the court acts upon and exercises its discretion which is not arbitrary, but based upon general rules. the newly appointed trustee shall have the same powers, authorities, and discretion regarding trust administration as the originally nominated trustee and he will act accordingly.
2. Relevant Provisions:
Sec. 73, 74, 75 Trusts Act 1882.
3. Appointment of new trustee:
- A new trustee in place of the initial or first trustee or other trustee can be made
- By the person nominated for that purpose by the instrument of trust or.
- By the author of the trust if he is alive and competent to contract or.
- By the surviving of continuing trustees or trustee or.
- By the legal representative of the last surviving and continuing trustee, or.
- With the consent of the court by retiring trustees, if they all retire simultaneously or.
- With the consent of the court, by the last retiring trustee.
4. Circumstances which render the appointment of trustee necessary:
Following are those circumstances which render the appointment of the trustee necessary.
(i) Death:
If a trustee dies, a new trustee will be appointed.
(ii) Trustee disclaims:
If the trustee is appointed disclaim new trustee will be appointed.
(iii) Absence of a trustee:
If a trustee more than six months is absent from the country.
(iv) Out of the country:
If the trustee is out of the country for staying abroad.
(v) Insolvency:
If a trustee is declared insolvent by the competent court.
(vi) Incapable to perform:
If a trustee refuses or becomes unfit or incapable of acting.
(vii) Acceptance of inconsistent trust:
If a trustee accepts inconsistent trust, a new trustee shall be appointed.
5. Appointment of the trustee by the court:
The court is empowered to appoint a new trustee under sec. 74 of trusts act.
Conditions
- Vacancy occurs or
- Disqualification of the trustee occurs or
- It is impracticable to appoint the trustee u/s 73.
- The application should be filed by the beneficiary.
- The application should be filed in the principal civil court of the original jurisdiction.
6. Scope:
In the Trusts Act 1882, the court has only power under sec. 73 and 74 to appoint a trustee. no section in the Trusts Act empowers the court to appoint the trustee. so the power of the court in this regard is limited.
7. Rules of appointment:
In appointing a new trustee the court shall have regard to
- The wishes of the author of trust as expressed in the instrument.
- The wishes of the person. if any, empowered to appoint a new trustee.
- The question is whether the appointment will promote or impede the execution of trust and,
- To the interests of all the beneficiaries where there is more than one.
Case law 1993 MLD 1666
It was held that a trust having been created for the benefit of a non-Muslim community, the respondent was the only member of that community, who has come forward to be appointed as a trustee and her application was not opposed by any other member of said community. The appellant being a Muslim had no locus standi to call in question the appointed respondent as a trustee in the execution proceeding. appointment of respondent as a trustee was not violative of any of the provisions contained in sec. 74 of trusts act.
8. Consequences of appointment:
When the new trustee is appointed under sec 73 or 74, all the trust property shall vested in the new trustee and shall enjoy the same powers. authorities and discretion and shall act, as if he had been originally nominated a trustee by the author of the trust.
9. Conclusion:
To conclude I can say that, the court has limited power under the Trusts Act to appoint a trustee in case of any disqualification of the trustee or impracticability to appoint a new trustee. the beneficiary may apply to the court for the appointment of a new trustee. in appointing new trustees, the court followed certain rules and the Trusts Act 1882.
`#TrusteeAppointment #LegalRights #TrustsAct1882 #CourtAppointedTrustee #TrustAdministration #BeneficiaryRights #TrustLaw #EstateManagement #TrusteeDuties #JudicialDiscretion`