Removing a Trustee and Resolving Trust Disputes Under Kenya’s Trust Administration Act

Trusts are meant to last for decades, and over that time relationships change. A trustee stops cooperating, a family member suspects assets are being misused, or co-trustees cannot agree. The Trust Administration Act, 2026 gives settlors, beneficiaries and enforcers a set of tools for these situations, from information rights to removal and court orders. This guide explains how trust disputes are handled under the new Act, from the first information request to court.

Resolving trust disputes: start with the trust deed

Section 94 provides that a dispute in relation to a trust is determined by the dispute resolution mechanism in the trust deed. Only where the deed is silent does the dispute go to the High Court. A well-drafted deed can therefore route disagreements to mediation or arbitration first, keeping them private and cheaper. When reviewing or drafting a deed, this clause deserves as much attention as the distribution provisions.

Getting information from trustees

Many disputes begin with a lack of information. Under section 49, trustees may disclose trust information on written request from an enforcer, a beneficiary (subject to the deed) or a settlor where the deed reserves that right, and must provide full and accurate information within 14 days of the request. An enforcer also has a separate right of access to any document, trust deed, account or other information needed for its functions (section 16). Trustees must keep records, including a list of trust property and copies of filings, for at least seven years (section 63). A written request citing these provisions is usually the first step.

Removing a trustee

There are two routes under section 40:

• Under the trust deed. If the deed allows removal, a trustee can be removed in accordance with its terms, but only after 21 days’ written notice of the intention to remove (section 40(3)).
• By the court. Any person with a legitimate interest in the trust may apply to court, which may order removal if it is in the interest of the trust and its beneficiaries (section 40(1)).

After removal, the remaining trustees must file a notice with the Registrar within 21 days, failing which they face an administrative penalty of KES 7,000 for an individual or KES 14,000 for a body corporate (section 40(4) and (5)). A settlor may also reserve the power to appoint and remove trustees in the deed (section 13(1)(d)).

Disqualification

Some trustees are removed by operation of law. Section 36 disqualifies, among others, a person disqualified from acting as a company director, an undischarged bankrupt, a person declared mentally incapacitated and a person convicted of corruption or an economic crime. Separately, where a trust breaches the beneficial ownership provisions and ignores the Registrar’s directive, the Registrar can give notice and then publish an intention to disqualify the trustees (section 69).

Replacing trustees and keeping the trust running

Where a trustee is disqualified or otherwise ceases to act, new trustees are appointed under the deed. If the deed is silent, the existing trustees may appoint additional trustees, or the beneficiaries or enforcer may apply to court (section 38). If one of several joint trustees dies, the survivors may act for up to 30 days to preserve the trust pending a new appointment (section 41). A change of trustees does not affect the trust’s existence, rights or obligations (section 42). Every newly appointed trustee must notify the Registrar within 21 days with a written consent to act (section 37(2)).

A trustee who wants to step down can resign by written notice to co-trustees, or to the beneficiaries if they are the sole trustee, unless the deed provides otherwise. A resignation has no effect if it is given to facilitate a breach of trust or is contrary to the deed (section 39). Where a trust is left without any trustee, the court may appoint the Public Trustee to act (section 39(3)).

Where property is stuck because no one can act, for example a trustee has died or refuses to sign a transfer, the court may make a vesting order that has the same effect as if the documents had been executed (section 70).

Holding trustees liable

A trustee who commits or is party to a breach of trust is liable for any resulting loss or depreciation in trust property and for any profit the trust would have made but for the breach (section 61(1)). The Act adds administrative penalties of up to KES 1 million for an individual trustee and KES 5 million for a corporate trustee (section 61(2)). A trust deed cannot exclude liability, or give an indemnity from trust property, for breaches arising from a trustee’s dishonesty, wilful misconduct or gross negligence (section 62). An enforcer can pursue civil or criminal proceedings against trustees (section 15(1)(e)).