September 2, 2015
Authored by: Luke Lantta
In Myers v. Myers, the beneficiary of several testamentary trusts filed a petition in probate court seeking, among other things, removal of the executor of the estate for numerous alleged breaches of fiduciary duty and a conflict of interest. The beneficiary later withdrew the request that the executor be removed out of concern over an in terrorem clause and limited the petition to a request for an accounting. In the amended petition, however, the beneficiary still repeated all of the original petition’s breach of fiduciary duty and conflict of interest allegations – he just didn’t specifically seek removal based on those allegations.
Although the request to remove the executor was withdrawn, the probate court entered an amended scheduling order setting a hearing on, among other things, the “Motion to Remove Executor.” The probate court held an evidentiary hearing and issued an order removing the executor based on breaches of fiduciary duties and an impermissible conflict of interest. The executor appealed several of the probate court’s rulings, including his removal based on a lack of notice that the hearing could result in his removal as executor.
The Georgia Supreme Court found that the executor had sufficient notice that he might be removed. Although the specific request to remove the executor was withdrawn, the executor should have known that, if the allegations in the beneficiary’s petition were proved true, he may be removed as executor. This would seem to suggest that anytime there is an evidentiary hearing in a case where breaches of fiduciary duty or conflicts of interest are alleged, a fiduciary may be at risk of getting removed even though there is not a specific request to remove him.
It may not be quite that simple – or dire. At the hearing, the beneficiary’s lawyer told the court that it had the power to remove the executor on its own even though the removal request had been withdrawn. The executor’s lawyer did not challenge that suggestion. Furthermore, the executor’s lawyer specifically addressed the removal issue and stated in his closing argument “[t]hey are asking you to remove [the executor] as executor. There’s no question about it.” The executor’s lawyer never argued that there was insufficient notice to remove the executor. Thus, there may have been a waiver or acquiescence issue for the executor. If the executor wanted to claim inadequate notice, the time to make that objection would have been at or before the hearing.
In Georgia, an executor should stay on her toes to watch out for direct or indirect removal attempts and, if a removal issue starts to develop at a hearing, make an objection to insufficient notice at that time.