Estate Planning & Probate
Trustee Defense Pennsylvania | Attorney for Trustees Facing Removal or Breach Claims
When a beneficiary files a petition to remove a trustee or demands an accounting in the Allegheny County Orphans Court, the trustee faces personal exposure under 20 Pa.C.S. § 7772. A trustee who breached their fiduciary duty can be surcharged personally, required to pay the trust from their own funds for losses caused by their conduct. The trustee who administered the trust carefully and the trustee who did not are in the same procedural posture once a petition is filed. Both need an attorney whose only client in the proceeding is the trustee personally.
Every page about trustee misconduct is written for the beneficiary suing. This one is written for the trustee who just received a demand letter or a petition to remove them.
Lebovitz & Lebovitz, P.A. · Serving Pittsburgh and Western Pennsylvania since 1933. Pittsburgh, PA 15218, near the Parkway East.
Trustees are appointed because someone trusted them to manage assets for others. That trust does not protect them from legal challenge when beneficiaries believe the trust was mismanaged, assets were diverted, or the trustee acted in their own interest. The remedies available to beneficiaries are directed personally at the trustee, not at the trust assets alone. A surcharge, a removal order, and a personal judgment against the trustee are all possible outcomes when a petition is filed and not properly defended.
A petition to remove a trustee or a surcharge demand has a response deadline. The trustee who waits to retain counsel, who responds informally, or who tries to negotiate directly with the petitioner’s attorney is at a structural disadvantage from the first day.
If you have received a petition, a demand letter, or a citation from the Orphans Court, call 412-351-4422 or contact our office now.
What the Petitioner Must Prove to Remove You
Pennsylvania courts remove trustees when the evidence establishes serious breach of fiduciary duty, unfitness to administer the trust, or circumstances that substantially impair administration. Disagreement is not grounds.
A petition to remove a trustee is not granted because beneficiaries are unhappy with distributions, disagree with investment decisions, or find the trustee difficult to work with. Pennsylvania courts remove trustees when the evidence establishes specific grounds under 20 Pa.C.S. § 7766: serious breach of fiduciary duty, unfitness to administer the trust, persistent failure to cooperate with co-trustees, or circumstances that substantially impair administration. Disagreement and dissatisfaction are not grounds. Harm to the trust is.
A trustee has broad discretionary authority under the trust document and Pennsylvania law to make investment decisions, determine distributions, and manage trust assets. The Pennsylvania Uniform Trust Act at 20 Pa.C.S. § 7771 requires the trustee to administer the trust in good faith, in accordance with its terms, and in the interests of the beneficiaries. A trustee who followed the trust terms, applied a reasonable standard of care to investment decisions, kept proper records, and communicated with beneficiaries has significant protection against a removal petition. The standard is not perfection. It is prudence and good faith.
What to Do in the First 48 Hours
The first 48 hours after receiving a petition or citation determine the shape of the defense. Do not contact the petitioner or the petitioner’s attorney directly. Anything said in that contact can be used in the proceeding. Do not take any further action with trust assets until counsel has assessed whether those actions are safe to complete or whether they risk providing additional grounds for the petition. Begin gathering every record that documents your administration of the trust.
The records that matter most: the trust document and all amendments. Bank and brokerage statements for trust accounts. All correspondence with beneficiaries. Investment policy statements and advisor correspondence if investment counsel was retained. Distribution requests, approvals, and payment records. Attorney invoices and correspondence if legal advice was sought during administration. Any documents relating to transactions the petition challenges. The trustee with organized contemporaneous records is in a fundamentally different position than one who administered the trust informally and has nothing to show for it.
The Surcharge: Personal Liability for Trust Losses
A surcharge order requires the trustee personally to restore losses to the trust caused by a breach of fiduciary duty. The trustee pays from their own funds, not from trust assets. The amount is the difference between what the trust would have had with proper administration and what it actually has. There is no statutory cap. A trustee who made imprudent investments, self-dealt, or failed to diversify trust assets can be surcharged for the full resulting loss.
The defenses to a surcharge are specific. A trustee who acted on the advice of qualified investment counsel, legal counsel, or a co-trustee has a strong reliance defense. A trustee who followed an explicit provision of the trust document has a compliance defense. A trustee whose investment decisions were reviewed and approved by beneficiaries, even informally, can raise acquiescence as a defense if the beneficiaries had adequate information when they approved. A trustee who made distributions consistent with a written distribution standard in the trust document is in a far stronger position than one who exercised discretion without documentation.
The most dangerous surcharge claims involve self-dealing: a trustee who purchased trust assets, lent money to themselves from the trust, or directed business to entities they control. Pennsylvania law presumes these transactions are improper under 20 Pa.C.S. § 7772. The burden shifts to the trustee to prove the transaction was fair, that the trust received full value, and that the conflict was disclosed before the transaction occurred. Most trustees cannot meet that burden without extensive documentation prepared before the transaction occurred.
Why the Trust Attorney Cannot Always Represent You
The attorney who drafted the trust, advised on administration, or represented the trust in prior matters may not be the right attorney when a beneficiary files a petition alleging that you personally breached your fiduciary duty. The trust attorney represents the trust. When your personal assets are at risk in a proceeding, your interests and the trust’s interests may diverge. Representing both the trust and the trustee personally in an adversarial proceeding creates a conflict under the Pennsylvania Rules of Professional Conduct.
Many trustees receive a removal petition or demand letter and immediately call the attorney who has been advising them on trust administration. That attorney may tell them they cannot represent them in the adversarial proceeding. Or they may not tell them and proceed in a role that creates an undisclosed conflict. Either way, a trustee whose personal assets are at risk needs independent counsel, an attorney whose only client in the proceeding is the trustee, not the trust and not the other beneficiaries.
What Happens After the Petition Is Filed
When a beneficiary files a petition to remove a trustee in Allegheny County Orphans Court, the court issues a citation directing the trustee to appear and respond. The trustee is served with the citation and the petition. A return date is set, often within three to four weeks. The trustee must file a response before that return date. Missing the return date or failing to respond is not neutral. It can result in a default order suspending the trustee’s authority to act.
After the initial response, the court typically schedules a hearing before an Orphans Court Master who takes testimony and makes findings of fact. The trustee has the right to file exceptions to the Master’s report before the judge confirms it. The trustee also faces the risk of interim suspension, a court order prohibiting any action with trust assets while the proceeding is pending. For a trustee with ongoing investment management, distribution obligations, or real estate transactions in progress, an interim suspension is an immediate and practical crisis.
Illustrative example: A trustee in Allegheny County administered a family trust for eleven years after her mother’s death. The trust held investment accounts and a rental property in the South Hills. Her brother, one of three beneficiaries, retained an attorney and filed a petition to remove her and a surcharge demand for $94,000, representing the brother’s calculation of investment losses he attributed to underperformance relative to a stock index. The trustee retained independent counsel. Her attorney obtained the trust document, which granted the trustee broad discretion in investment management and explicitly authorized retention of a professional investment advisor. The advisor’s records showed regular account reviews, documented investment rationale, and written quarterly reports sent to all beneficiaries including the brother. The brother had attended two annual trust meetings, asked questions, and raised no objection to the investment approach. The Master found no breach of fiduciary duty. The investment decisions were made in good faith, with professional advice, in accordance with the trust document, and with beneficiary knowledge. The petition was dismissed. The surcharge was denied. The documentation that had accumulated over eleven years of careful administration resolved the proceeding.
Frequently Asked Questions
I just received a petition to remove me as trustee. What do I do first?
Retain independent counsel immediately. Not the attorney who drafted the trust or advised you on administration. Retain an attorney whose only client in this proceeding is you personally. Do not contact the petitioner or their attorney directly. Do not take any action with trust assets until counsel has reviewed the situation. Gather every record relating to your administration of the trust. The return date on the citation gives you weeks, not months. The attorney retained in the first week has more options than the one retained the week before the hearing.
Can I be removed as trustee for investment decisions beneficiaries disagree with?
Disagreement alone is not grounds for removal. Pennsylvania courts remove trustees when the evidence establishes serious breach of fiduciary duty, unfitness to administer the trust, or circumstances that substantially impair administration. A trustee who made investment decisions in good faith, with professional advice, in accordance with the trust document, and consistent with a prudent investor standard has significant protection. The standard is not whether every beneficiary is satisfied with investment returns. It is whether the trustee administered the trust with the care a prudent person would use in managing their own affairs.
What is a trustee surcharge and how much can I be personally liable for?
A surcharge requires you to personally restore losses to the trust caused by a breach of fiduciary duty. You pay from your own funds, not from trust assets. The amount is the difference between what the trust would have had if you had acted properly and what it actually has. There is no statutory cap. The defenses are specific: reliance on qualified professional advice, compliance with trust document terms, beneficiary acquiescence with adequate information, and good faith administration documented throughout the trust term.
I purchased something from the trust or did business with the trust. Is that a problem?
It may be a serious problem. Pennsylvania law presumes that transactions between a trustee and the trust are improper. The burden shifts to you to prove the transaction was fair, the trust received full value, and the conflict was disclosed. Most trustees cannot meet that burden without documentation prepared before the transaction occurred, including an independent appraisal, beneficiary consent, and legal advice confirming the transaction was permissible. A self-dealing transaction that was not disclosed and documented at the time is among the most difficult trustee defenses to mount after the fact.
Can the court suspend my authority as trustee while the petition is pending?
Yes. Pennsylvania courts can suspend a trustee’s authority on an interim basis when the petitioner demonstrates that trust assets are at immediate risk. A suspension order means you cannot take any action with trust assets until it is lifted. Pending investment decisions cannot be made. Pending distributions cannot be sent. If you have ongoing trust management obligations when a petition is filed, the risk of interim suspension is a reason to retain counsel immediately rather than waiting to see how the proceeding develops.
Does relying on my attorney’s advice protect me from a surcharge?
Yes, in most circumstances. A trustee who acts in good faith in reliance on the advice of qualified legal counsel has a strong defense to a surcharge claim based on that action. The reliance must be genuine and the advice must have been sought before the action was taken. A trustee who consulted an attorney about a specific transaction and then followed that advice is in a much stronger position than one who acted first and sought legal justification later. Keep all attorney correspondence relating to trust administration decisions.
For the fiduciary breach framework from the beneficiary’s perspective, see our page on trustee removal in Pennsylvania. For trust litigation generally, see our page on trust litigation in Pittsburgh. For executor defense in similar proceedings, see our page on executor defense in Pennsylvania.