There is no limit to the number of trustees a grantor can name in a trust. There are, however, practical considerations involved with naming trustees, such as experience in trust administration, trust tax, knowledge of the trust grantor’s wishes and issues that can arise when naming an individual person as trustee.
Even Number of Trustees
Many trust drafters create a trust with two trustees where one trustee is an individual such as a family member and the other trustee is a professional corporate trustee. This arrangement can be a problem if there is a disagreement between the trustees. Unless the trust agreement expressly states that one trustee or the other has overruling authority, any conflicts unable to be resolved by state statutes result in a deadlock necessitating resolution through the courts.
Odd Number of Trustees
If the grantor decides to name more than one trustee, it will be prudent to establish an odd number of trustees. Most state probate codes allow that, in the event of trustee disagreement, the majority vote of the trustees decides the issue. Conflicts involving expensive litigation can be avoided by the vote of an odd number of trustees.
Grantors often wish to appoint family members to serve in a trustee capacity, but due consideration should be given to naming individual trustees. Trusts typically last for a very long period of time. Individuals can become sick or unable to manage trust affairs, or can die. If a trust has three individual trustees that all eventually are unable to serve, the trust will end up in the court system for the appointment of new trustees -- a situation counter to the wishes of many grantors.
Individual and Corporate Trustees
The optimum mix of trustees contains both family members and a trusted corporate financial institution that can serve as trustee. Corporate trustees have trust expertise without the health, death or competency problems found among individuals. Even if a grantor prefers individuals as trustees, it remains prudent to have a corporate trustee named to serve in a successor trustee capacity in the event the individual trustees are no longer able to serve. The main advantage of having a corporate trustee is that they are independent and have no interest in the trust, which is preferable in the event family members disagree over trust management.
Mary Frazier began writing in 2011 for various websites and has over 20 years of experience as a bank vice president and senior trust officer. Frazier is a Certified Trust and Financial Advisor, holds a Bachelor of Arts in economics from the University of North Florida and holds a Master of Science in finance from the College for Financial Planning.