Suing an Out of State Trustee in California
California has a lot of laws meant to protect beneficiaries from bad acting trustees. While some states give equal protection to beneficiaries as California, many other states do not. For that reason, occasionally you will see a trustee try to move the place of administration to another state, in the hopes that the trustee will have greater leeway in how they administer the trust.
While it is true that generally speaking that the proper venue for a trust is where the principal place of administration is located (Probate Code section 17005) a trustee cannot force a beneficiary to submit to the laws of another state in most circumstances.
Probate Code section 17003 states that if you control of the administration of a trust that was previously being administered in California, that California has jurisdiction over the administration of the trust.
That means, in the vast majority of cases a beneficiary can bring the trustee’s actions before a California court even if that particular trustee has always administered the trust in a different state.
However, this statute would not apply if the trustee before them also administered the trust out of California. So, for example, let’s say the trustors died in California, the trust names their eldest daughter to act as trustee and in the case of resignation, can appoint the next trustee. Let’s then say the eldest daughter accepts the title of trustee and resides in Arizona, however, a year into the administration decides to resign and appoints her husband, who also resides in Arizona. In that case, because when the husband took over, the trust was being administered in Arizona, the beneficiary could not force the husband to defend his actions in California based upon Probate Code 17003. Now, there may be other legal procedures that could be used in this specific hypothetical to still litigate the husband’s actions in California, but the described turn of events would likely neutralize Probate Code 17003.