All too often co-fiduciaries do not see eye to eye in the administration of an estate or trust. They can usually work through their disagreements, but when they cannot, and their arguing and finger pointing have reached a level where their administration reaches a stand-still, one fiduciary might seek to remove his co-executor or co-trustee.
The grounds for removal are specifically enumerated in SCPA § 711, and they include the following: (1) at the time or after letters were issued, the fiduciary was or has since become ineligible or disqualified to act; (2) the fiduciary has wasted or improperly applied the assets of the estate, made investments unauthorized by law, or otherwise improvidently managed or injured the property in his charge; (3) the fiduciary willfully or neglected to obey a lawful court order; (4) the letters were obtained by a false suggestion of a material fact; (5) per the terms of a will or trust, the fiduciary’s role was to act upon the occurrence of an act which has occurred; (6) the fiduciary failed to notify the court of a change in address within 30 days after such change; (7) the fiduciary removed property from the state without prior court approval; (8) the fiduciary does not possess the requisite qualifications by reason of substance abuse, dishonesty, improvidence, want of understanding, or is otherwise unfit to act as fiduciary; (9) in the case of a guardian, where he has removed or is about to remove from the state or where the interests of the infant will be promoted by the appointment of another person as guardian; (10) in the case of a testamentary trustee, where he has violated or threatens to violate his trust or is insolvent or is otherwise deemed unsuitable; (11) in the case of an inter vivos trustee, where the Supreme Court could have cause to remove the trustee, or suspend or modify the appointment; and (12) where a fiduciary fails to file an account after being directed by the court to do so.
Where the orderly administration of an estate or trust comes to a standstill because of friction between co-fiduciaries, SCPA § 711(8), a “want of understanding” of what it means to be a fiduciary provides a basis for removal. But removal is not an easy task, as the courts give great deference to a testator’s choice of fiduciary. Thus, where the facts supporting the removal petition are disputed, the courts will generally not remove a fiduciary without a hearing. But this is not always the case. There are instances where the record supports removal without a hearing.
This is exactly what occurred in the recent decision in Estate of Sullivan. There, the decedent’s will nominated his siblings, James and Judith, as co-executors of his estate. James brought a petition to remove Judith as co-executor on the grounds that her refusal to engage with him—essentially abdicating her role as fiduciary—hindered his ability to effectively administer the estate. Specifically, James alleged that after he was granted court permission to sell a parcel of real property, Judith failed to share certain pertinent information with him regarding the tenants and she had maintained disorganized records of the leases, which prolonged that sale for 18 months. James also alleged that Judith frustrated his ability to see other real properties belonging to the estate by refusing he remove her personal belongings from the buildings, disputing how to list the properties for sale, and refusing to meaningfully engage in discussions with him regarding necessary repairs to the buildings. According to the decision, this deadlock continued even after counsel for James and Judith had seemingly reached an agreement on the issues during a court conference, and drafted a stipulation in that regard.
James sought to remove Judith as a fiduciary under SCPA §711(6) and (8). Judith filed objections to the petition, but the Court granted the petition and removed Judith as fiduciary withhold holding a hearing. Critical to the Court’s decision was the fact that Judith did not dispute the allegations in the petition or in James’s accompanying affidavit with any admissible evidence. She did not file an affidavit disputing any of the facts set forth in the petition or supporting her objections. Rather, she relied on an affirmation of her attorney who professed to have personal knowledge of the history of the administration of the estate. That affirmation along with a draft affidavit from Judith in which she merely “adopted and incorporated” her counsel’s statements was not sufficient for the Court. It stated:
An attorney affirmation not based upon personal knowledge has no evidentiary value. Zuckerman v. New York, 49 N.Y.2d 557, 560 (1980). While Judith’s counsel purports to have personal knowledge of the facts, it is Judith who is the co-executor and who must answer to the allegations that she has abdicated her fiduciary duties, delaying and thwarting efforts to resolve this estate.
The Court was also not satisfied with Judith’s objections to the petition, verified by counsel and not Judith, which were “sparse and evasive.” Particularly, the Court was not impressed with Judith’s denials of certain allegations because she “lacks sufficient information to form a belief” as to their truth. Indeed, a fiduciary’s very job is to personally know what is going on with the administration of an estate.
The Court found that Judith’s failure to refute the facts demonstrated her wanton understanding of what it meant to be a fiduciary, and concluded that removing her as co-executor without a hearing was proper. Additionally, the Court found that it could remove Judith without a hearing because she did not dispute that she moved and failed to give the Court the requisite notice (SCPA § 711(6)).