What Happens If a Trustee Dies in Alabama?

When a trustee dies in Alabama, the trust doesn’t end. The successor trustee named in the trust document steps in and takes over. If the trust doesn’t name one, Alabama law sets out who can fill the role, starting with the beneficiaries and ending with the court.

The trust’s assets stay in the trust the entire time. They don’t become part of the deceased trustee’s personal estate, and they don’t go through the trustee’s probate.

What Happens to a Trust When the Trustee Dies?

A trust is a legal arrangement that exists separately from the person managing it. When a trustee dies, Alabama law treats it as a vacancy in the trusteeship. The trust itself keeps going.

What happens next depends on three questions:

• Is there a co-trustee still serving?
• Does the trust name a successor trustee?
• If not, can the beneficiaries agree on a replacement?

The rules for answering those questions are found in the Alabama Uniform Trust Code, specifically Alabama Code § 19-3B-704.

What Happens When the Creator of a Revocable Trust Dies?

This is the most common version of this question. With most revocable living trusts, you create the trust and serve as your own trustee during your lifetime.

When you die:

• Your named successor trustee takes over management of the trust
• The trust becomes irrevocable, so its terms can no longer be changed
• The successor trustee settles the trust by paying final expenses and distributing assets under the trust’s instructions

This is exactly how a revocable trust is designed to work. No probate court is involved for assets titled in the trust. Our post on whether a revocable living trust avoids probate in Alabama explains why funding the trust matters.

What Happens If There Are Co-Trustees?

If a trust has two or more trustees and one dies, the remaining co-trustee or co-trustees generally keep serving. Under Alabama law, the vacancy doesn’t have to be filled as long as at least one co-trustee remains in office.

A few things to keep in mind:

• The trust document may require a replacement anyway, so read it carefully
• When co-trustees can’t agree unanimously, Alabama law generally lets them act by majority decision
• If only one trustee remains, that person may carry a much heavier workload than the trust’s creator expected

What If No Successor Trustee Is Named in Alabama?

If the trust has no remaining trustee, the vacancy must be filled. For a typical family (noncharitable) trust, Alabama law sets this order of priority:

1. The person named in the trust as successor trustee
2. A person appointed by unanimous agreement of the adult qualified beneficiaries (generally, the beneficiaries currently entitled to distributions or next in line)
3. A person appointed by the court

The unanimous-agreement option can save a family time and money. But it requires every adult qualified beneficiary to agree. If even one objects, the decision goes to court.

Alabama’s Advance Successor Designation Rule

Alabama has a helpful provision that many states don’t. If you’re serving as sole trustee and your trust doesn’t name a successor, you and the adult qualified beneficiaries can sign a unanimous written agreement designating a successor ahead of time. That person becomes trustee automatically when the vacancy occurs.

The agreement can be recorded in the probate court or kept with the trust records. It’s a simple fix for an older trust with a gap in its succession plan.

What If the Successor Trustee Declines or Also Dies?

Being named successor trustee doesn’t force someone to serve. A named successor can reject the role, which creates a vacancy just like a death does.

When the first successor can’t or won’t serve:

• The next successor named in the trust steps in, if there is one
• If no one else is named, the beneficiaries can try to agree on a replacement
• If they can’t, a court will appoint someone

This is why well-drafted trusts name at least two successor trustees, and often include a way to appoint more.

Successor Trustee Duties in Alabama

Once a successor trustee accepts the role, they take on real legal responsibilities. Alabama law requires a trustee to act in good faith, in the beneficiaries’ interests, and according to the trust’s terms.

Typical first steps for a successor trustee:

• Get certified death certificates and locate the original trust document and any amendments
• Prepare a certification of trust, a short document banks and title companies use to confirm your authority
• Get a tax ID number (EIN) for the trust if it has become irrevocable
• Take control of trust assets, including retitling accounts and securing real estate
• Notify the beneficiaries and keep them reasonably informed about the trust and its administration
• Pay valid debts, expenses, and taxes
• Invest and manage trust property prudently until it’s distributed
• Keep detailed records of every transaction
• Distribute assets according to the trust’s terms

Alabama also requires trustees to be loyal (no self-dealing) and impartial (treating beneficiaries fairly). A successor trustee who falls short of these duties can be held personally liable, and in serious cases removed. Our post on whether a trustee can be removed in Alabama explains when that happens.

What Happens to Trust Assets Held by the Deceased Trustee?

Trust property belongs to the trust, not to the trustee. When a trustee dies, those assets do not pass under the trustee’s will or through the trustee’s probate.

In practice, though, the deceased trustee’s family may have the trust’s records, checkbooks, or keys to trust property. If you’re handling the estate of someone who was serving as a trustee:

• Keep trust assets and records separate from the personal estate
• Don’t distribute or sell trust property as if it belonged to the deceased
• Help the successor trustee get what they need to take over

Mixing up the two can create serious liability for the estate and the family.

Does a Successor Trustee Have to Go to Court in Alabama?

Usually not. One of the main benefits of a trust is that the successor trustee can step in and administer it privately, without opening a court case.

Court involvement is generally needed only when:

• There’s no trustee and the beneficiaries can’t unanimously agree on one
• Beneficiaries dispute how the trust is being managed
• The trust’s terms are unclear and need interpretation
• Someone asks the court to review or remove a trustee

For a comparison of how this differs from probate, see probate vs. trust administration in Alabama.

How to Keep Your Trust From Being Left Without a Trustee

A trust is only as strong as its succession plan. When you create or review your trust, make sure it:

• Names at least two successor trustees, in order
• Includes a way to appoint a new trustee if everyone named is unavailable, such as giving that power to an adult beneficiary or a trusted advisor (sometimes referred to as a “Trust Protector”)
• Considers a professional or corporate trustee as a final backup
• Is reviewed every few years, especially after deaths, divorces, or moves in your family

If your trust was signed years ago and some of your named trustees have died or moved away, it’s time to update it.

Get Help With a Trust After a Trustee Dies

Whether you’ve just become a successor trustee or you want to make sure your own trust has a solid plan for succession, you don’t have to figure it out alone.

Valley Estate Planning is North Alabama’s largest estate planning firm. Our board-certified elder law attorneys bring more than 40 years of combined experience, and more than 200 five-star reviews reflect how we guide trustees and families through trust administration. We help successor trustees understand their duties, protect themselves from liability, and settle trusts efficiently.

Request your free 15-minute discovery call to talk through your trust and your next steps.