If a trustee has lost mental capacity, and cannot sign trust documentation, what can be done to remove them as a trustee and replace them with someone who can act?

This is often a tricky situation to deal with. Ordinarily, if a trustee had perhaps become unwell, and was happy to be replaced by someone who could act ongoing, they would sign documentation such as a Deed of Retirement and Appointment. However, if matters have progressed beyond this, in that the trustee in question has lost mental capacity then an alternative solution must be looked at.

Possible express power

The first step to take would be to check the trust documentation to see whether there is an express power whereby, for example, either the original settlor or the remaining trustees can remove a trustee who can no longer act.

What if there is no express power?

Generally, if there is no express power within the documentation, then a Court of Protection application will have to be made under section 36 Trustee Act 1925 to approve the removal of a trustee and to replace them with a new trustee.