How to Formally Decline to Serve as a Trustee: Your Rights and Responsibilities
Being named as a trustee carries significant legal and practical responsibilities. You may decide that you do not have the time, experience, or ability to serve, or that accepting the role could create family or financial complications.
At Commonwealth Life and Legacy Counsel, husband-and-wife attorneys Michael Winget-Hernandez and Lelia Winget-Hernandez help Central Virginia families address trust administration and fiduciary transitions.
This guide explains how a nominated trustee may decline the appointment under Virginia law, how to avoid unintentionally accepting the role, and what changes if the person has already begun serving.
Declining, Resigning, and Removal Are Different
The correct process depends largely on whether you have already accepted the trusteeship.
Declining a Trusteeship
Declining, which Virginia law calls rejecting the trusteeship, means refusing the appointment instead of accepting it.
A person who knows of the designation but does not accept the trusteeship within a reasonable time is deemed to have rejected it. Va. Code § 64.2-754.
Although the statute does not require one universal rejection form, a clear written rejection can document the decision and reduce uncertainty for the settlor, beneficiaries, other trustees, and financial institutions.
Resigning After Acceptance
Resignation applies after a person has accepted the trusteeship.
Under Virginia law, a serving trustee may resign by giving at least 30 days’ notice to:
- The settlor, if living
- All co-trustees
- The qualified beneficiaries, except qualified beneficiaries of a revocable trust that the settlor has capacity to revoke
A trustee may also resign with court approval. The court may impose conditions needed to protect the trust property. Va. Code § 64.2-758.
Resignation does not automatically discharge the trustee from liability for acts or omissions that occurred while serving.
Removal of a Trustee
Removal is different from rejection or resignation. It is a court-ordered end to a trustee’s service.
The settlor, a co-trustee, or a beneficiary may ask the court to remove a trustee. A court may also act on its own initiative under the circumstances listed in Va. Code § 64.2-759.
A person who has not accepted the appointment ordinarily does not need to seek removal. The issue is instead whether that person clearly rejected the trusteeship without taking actions that constituted acceptance.
How a Person Accepts a Trusteeship in Virginia
Virginia law recognizes more than one way to accept a trusteeship.
A designated trustee accepts by substantially complying with the acceptance method stated in the trust. If the trust does not provide a method, or if its method is not expressly exclusive, acceptance may also occur by:
- Accepting delivery of trust property
- Exercising trustee powers
- Performing trustee duties
- Otherwise indicating acceptance of the trusteeship
A person may therefore accept the role through conduct even without signing a document titled “Acceptance of Trusteeship.”
Actions that may indicate acceptance include:
- Taking control of trust accounts or property
- Paying trust expenses
- Making distributions to beneficiaries
- Signing contracts, tax documents, deeds, or account forms as trustee
- Directing banks or investment firms on behalf of the trust
- Negotiating or settling claims in the trustee’s capacity
- Representing to beneficiaries or third parties that the person is serving as trustee
Whether a particular act constitutes acceptance depends on the trust terms and the surrounding circumstances.
Actions Allowed Without Accepting the Trusteeship
Virginia law allows a nominated trustee to take two limited types of action without accepting the position.
First, the person may act to preserve trust property. To avoid acceptance, the person must send a rejection within a reasonable time after acting. The rejection must be sent to the settlor or, if the settlor is deceased or lacks capacity, to a qualified beneficiary.
Second, the person may inspect or investigate trust property to determine possible liability under environmental or other law, or for another purpose.
These limited exceptions appear in Va. Code § 64.2-754(C).
For example, a nominated trustee may need to arrange an urgent step to prevent damage to trust real estate. That action does not necessarily amount to acceptance if the statutory requirements are met. However, broader management activity may cross the line into exercising trustee powers.
Reviewing the Trust Before Making a Decision
Begin by reading the trust document carefully. It may contain its own provisions governing:
- Acceptance or rejection of the trusteeship
- Notice requirements
- Successor trustees
- Co-trustee authority
- Trustee resignation
- The trust’s governing law
- The principal place of administration
The trust may require a particular form of acceptance or establish a process for appointing the next successor. Its terms may also provide more direction than Virginia’s default statutory rules.
Relevant documents may include:
- The complete trust agreement
- All amendments and restatements
- Any certificate of trust
- Prior acceptance or resignation documents
- Records identifying current trust property
- Correspondence from the settlor, acting trustee, beneficiaries, or financial institutions
Reviewing the documents before acting can help distinguish information gathering from conduct that may indicate acceptance.
How to Document a Rejection of the Trusteeship
Virginia law does not prescribe a single mandatory form for every rejection. A written document is nevertheless useful because it provides a record of the decision.
Information to Include
A written rejection may identify:
- The full legal name and address of the nominated trustee
- The full name of the trust
- The date of the trust agreement, if known
- The name of the settlor
- The capacity in which the person was nominated
- A clear statement that the person rejects or declines the trusteeship
- A statement that the person has not accepted the trusteeship, when accurate
- The effective date
- The person’s signature
The language should be direct.
For example:
I decline and reject my designation as trustee of the [full trust name] and do not accept the trusteeship.
The document should not describe the person as the “current trustee” unless that description is legally accurate.
Is Notarization Required?
Va. Code § 64.2-754 does not impose a universal notarization requirement for rejecting a trusteeship.
The trust document may require additional formalities, and a bank, title company, or other institution may request a notarized document before updating its records. Notarization may also help confirm the authenticity of the signature, but it should not be presented as a statutory requirement in every case.
Who Should Receive the Written Rejection?
The trust agreement should be reviewed first because it may specify who must receive notice.
Depending on the circumstances, appropriate recipients may include:
- The settlor, if living
- The acting trustee
- Any co-trustees
- The next named successor trustee
- A person given authority to appoint a successor trustee
- A qualified beneficiary when required under Va. Code § 64.2-754(C)
- An institution that has contacted the nominated trustee about trust property
Virginia law does not require every person rejecting an untouched appointment to send notice to all beneficiaries. That broader notice requirement applies to resignation after acceptance under Va. Code § 64.2-758, not necessarily to reject under Va. Code § 64.2-754.
Using a delivery method that creates a record, such as certified mail, tracked delivery, or acknowledged email, may help establish when and to whom the rejection was sent.
The nominated trustee should retain:
- A signed copy of the rejection
- Proof of delivery
- Related correspondence
- Notes identifying any limited action taken to preserve or inspect trust property
What Happens When a Co-Trustee Declines?
One nominated co-trustee’s rejection does not necessarily prevent the other co-trustees from serving.
If a vacancy occurs in a co-trusteeship, the remaining co-trustees may act for the trust. Virginia law also generally permits co-trustees who cannot reach a unanimous decision to act by majority, subject to the trust’s terms and the other requirements of Va. Code § 64.2-756.
The trust should still be reviewed to determine whether the vacancy must be filled. If a vacancy in a noncharitable trust must be filled, Virginia law establishes this order:
- A person designated under the trust’s terms
- A person appointed by unanimous agreement of the qualified beneficiaries
- A person appointed by the court
Va. Code § 64.2-757.
The trust may also require a minimum number of trustees or give a named person the power to appoint a replacement.
Dealing With Banks and Other Institutions
A nominated trustee may be contacted by a bank, brokerage firm, title company, insurer, or other institution because the person’s name appears in the trust or a certificate of trust.
A person who intends to reject the trusteeship should avoid signing:
- Trustee acceptance forms
- Account-opening documents
- Signature cards
- Transfer instructions
- Contracts or deeds
- Tax forms identifying the person as acting trustee
The person may provide the institution with a copy of the written rejection and direct it to the acting or successor trustee, if known.
Care is important because signing documents, directing accounts, or otherwise representing oneself as trustee may indicate acceptance under Va. Code § 64.2-754.
The next acting trustee will generally need to establish their own authority under the trust and the institution’s procedures. A person who declined should not sign documents on behalf of that successor.
What if You Already Took Trustee Actions?
A person who has already exercised trustee powers or performed trustee duties may have accepted the trusteeship, even without signing a formal acceptance.
Relevant actions may include:
- Controlling trust assets
- Paying expenses
- Making beneficiary distributions
- Signing documents as trustee
- Filing tax returns for the trust
- Entering contracts on the trust’s behalf
- Giving investment or transfer instructions
In that situation, a rejection document may not be enough. The person may need to follow the resignation procedure in Va. Code § 64.2-758.
A serving trustee may also need to:
- Protect and transfer trust property
- Provide information to the next trustee
- Address pending transactions
- Prepare records or an accounting
- Notify the people entitled to statutory notice
A trustee has an ongoing duty to keep qualified beneficiaries reasonably informed about trust administration and material facts needed to protect their interests. Va. Code § 64.2-775.
The specific transition duties depend on the trust, the property involved, and what occurred during the person’s service.
Common Mistakes When Declining a Trusteeship
Acting Before Deciding
Taking control of assets or directing an institution may establish acceptance. A nominated trustee can review the trust and use the limited statutory exceptions, but should avoid broader administrative activity until deciding whether to serve.
Relying Only on Silence
Virginia treats a failure to accept within a reasonable time as rejection. Even so, silence may leave the settlor, beneficiaries, co-trustees, and institutions uncertain about who has authority. Va. Code § 64.2-754.
A written rejection creates a clearer record.
Using the Wrong Procedure
A person who never accepted generally rejects the appointment. A person who is already accepted generally resigns. Treating the two as interchangeable can create questions about notice, transition duties, and responsibility for prior actions.
Sending Notice to the Wrong People
The recipients depend on the trust terms and whether the person is rejecting before acceptance or resigning after acceptance. The statutory 30-day notice requirements for resignation should not automatically be applied to every rejection.
Failing to Preserve Records
A copy of the trust, the rejection, proof of delivery, and any related communications can help resolve later questions about whether the person accepted or acted on behalf of the trust.
Understanding the Next Step in a Trustee Transition
A person named as trustee does not have to accept the appointment. The important questions are whether the person has already taken actions indicating acceptance, what procedure the trust requires, and who needs notice so the next trustee can assume responsibility.
At Commonwealth Life and Legacy Counsel, we help families understand trust administration and fiduciary transitions when a nominated or serving trustee cannot continue in the role.
Call our Zions Crossroad office at 434-589-2958 or our Powhatan office at 804-598-1348, email info@winget-hernandez.com, or reach out through our contact page.
Disclaimer: This article is educational only and is not legal advice. Reading it does not create an attorney-client relationship.