The Matter of the Estate of Ray F. Morningstar, N.Y.S. 2D 674(A.D. 4 Dept 2005) , a recently reported case , concerned a dispute between alleged nonmarital children of the decedent and the decedent’s marital children who were the estate’s administrators. In its decision denying the petition of the alleged nonmarital children for the removal of the marital children as administrators, New York’s Appellate Division speaks at length to the reasons when a fiduciary may be removed.
In this case, the Court found that the marital children serving as the estate’s administrators had a duty to require the alleged nonmarital children to establish that they had standing to share as beneficiaries of the estate.
Generally, fiduciaries may be removed only for misconduct and not just having a conflict of interest or a dispute with beneficiaries of the estate. The Surrogate’s Court Procedure Act (SCPA) provides that “an interested” party may petition for the removal of a fiduciary, but this will require a documented showing of waste or mismanagement of estate assets. In cases where there is “well-documented hostility” between a fiduciary and persons interested in the estate, there may be justification for the removal of a fiduciary but it needs to be shown that the hostility jeopardizes the interests of the beneficiaries and the proper administration of the estate. In Morningstar, the hostility between the parties was the result of the administrators doing their jobs appropriately so that there were no grounds for their removal as fiduciaries.