APPOINTMENT OF TRUSTEE

Section 10 of the Indian Trust act provides that “a person who is capable to hold the property can
be appointed as trustee”
Case- Ganpati vs Santri- In this case it was held that the trustee who is careless in discharge of
his duties is not competent
Section 73 provides that new trustees in place of initial or first trustees or other trustees can be
made,
(i) By the person nominated for that purpose by the instrument of trust, or
(ii) By the author of the trust if he is alive and competent to contract, or
(iii) By the surviving or continuing trustees, or
(iv) By the legal representative of the last surviving or continuing trustee, or
(v) With the consent of the court by the retiring trustees, if they all retire simultaneously,
or
(vi) With the consent of court, by the last retiring trustee
Other important points under Section 73 are:
 Every appointment under this section shall be done by writing under the hand of person
making it.
 The Official Trustee may, with his consent and by the order of the Court, be appointed
under this section, in any case in which only one trustee is to be appointed and such trustee
is to be the sole trustee.

APPOINTMENT BY COURTS
Section 74 deals with the appointment of trustee by the courts. This section provides that in
appointing new trustees the court shall have regard to the following things:
(i) The wish of the author of the trust, as expressed or inferred from the instrument of trust
(ii) The wishes of the person who is empowered to appoint new trustees
(iii) The question whether it will promote or impede the execution of the trust and
(iv) To the interest of all the beneficiaries where there are more than one.

REMOVAL OF TRUSTEE
Section 73 also makes provision for the removal of trustees in the following cases:
(i) If trustee is absent from India for a continuous period of six months, or
(ii) If trustee leaves India for the purpose of residing abroad, or
(iii) If the trustee is declared as insolvent
(iv) If the trustee is incapable to act as an trustee
(v) If the trustee accepts something which is inconsistent to the trust.

RIGHTS OF TRUSTEE
 1. Right to Title Deed- Section 31 of the Indian Trust Act deals with right of trustee to title
deed. This section provides that a trustee is entitled to possession of instrument of trust and
all the documents related to trust.
2. Right to Reimbursement- Section 32 of the Indian Trust act deals with right of trustee to
reimbursement of expenses. This section provides that it is the right of trustee to be
reimbursed from the trust property, as regards to all expenses incurred in connection with
the execution, realization, preservation, protection of trust and support of the beneficiary.

If the trustee pays expense out of his own pocket then he has a charge on the property of
trust first for such expenses and if the trust property fails trustee is entitled to recover from
beneficiary.

This section also provides that if a trustee by mistake made an overpayment to the
beneficiary, then he may reimburse the trust property from the beneficiary`s interest and
if such interest is failed beneficiary is liable to pay him personally.
3. Right to Indemnity- Section 33 of the Indian Trust act provides that A person who has
gained an advantage for breach of trust must indemnify the trustee to the extent of amount
received under such breach and if such a person is beneficiary , then the trustee has charge
on his interest for such amount.
4. Right to seek court`s direction- Section 34 of the Indian Trust Act provides that any
trustee may apply by a petition to principal civil court for its opinion, advice or discretion
on questions relating management or administration of the trust property..
5. Right to settlement of Accounts- Section 35 of the Indian Trust Act provides that when
the duty of trustee is completed, he is entitled to examine and settle the accounts and to
obtain the acknowledgment that nothing is due to the beneficiary under Trust.

DUTIES OF TRUSTEE
1. Duty to Execute the Trust- Section 11 of the Indian trust Act provides that the trustee is
bound to fulfil the purpose of the trust and to obey the directions of the author of trust.
2. Acquaintance with Trust Property- Section 12 of the Indian Trust Act provides that a
trustee is bound to acquaint himself with the nature and circumstances of the trust property
and to transfer the trust property to himself.
3. To protect title to Trust Property- Section 13 of the Indian Trust Act provides that a
trustee is bound to maintain and defend suits for the assertion and protection of its title and
for this purpose must take all reasonable and possible steps for this occasion.
Case- Homi Nariman Bhiwandiwala vs Zoroastrian Co- operative Credit Bank1- In this case
it was held that all the trustees should be made party to suit.
4. Not to setup Adverse Title- Section 14 of the Indian trust act provides that the trustee
must not setup the title which is adverse to the interest of beneficiary.

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2001 (3) BOMCR 352
Case- Narayan Bhagwantrao Gosavi vs Gopal Vinayak Gosavi2- In this case it was held that a
trustee must not mix private property with trust property, because if he does so, he undertakes a
heavy burden of proving that any particular property is his, as distinct from the trust.
5. To execute reasonable care- Section 15 of the Indian Trust act provides that a trustee is
bound to deal with the trust property as a man of ordinary prudence would deal with his
property. He is not responsible for any loss or destruction caused to the property if he has
taken reasonable care.
6. To convert perishable property- Section 16 of the Indian Trust act provides that when
the trust is created for the purpose of benefiting several persons in succession and the
property of trust is of perishable nature, then in such a situation he is bound to convert
property into a permanent and profitable character.
7. To be Impartial- Section 17 of the Indian Trust act provides that when there are more than
one beneficiaries of a trust, then the trustee should be impartial to all of them
8. To prevent Waste- Section 18 of the Indian Trust act provides that when the trust is created
for benefit of various persons in succession and any one of them is in possession of trust
property and such a person commits or threatens to commit damage to the property of trust,
then the trustee can take various measures against him.
9. To maintain proper accounts- Section 19 of the Indian trust act provides that a trustee is
bound to keep clear and accurate accounts of the trust property and furnish beneficiary with
full information as to amount and state of trust property
10. Investment of trust property- Section 20 of the Indian Trust act provides that when the
property of trust consists of money and cannot be applied immediately, then in such a
situation trustee invest such money in any of the securities which are specified by Central
government in its official gazette.

PYQ
Q. Name the sections which cover appointment and removal of trustee under the Indian Trust
act(2014) 1 marks
Q. Explain the rights of trustee(2016) 4 marks
Q. Explain the circumstances under which new trustees can be appointed(2016) 8 marks
Q. Discuss the duties and rights of the trustee under the Indian Trust act, 1882(2017, 2019) 8 marks
Q. What are duties and liabilities of a trustee? Discuss under Indian Trust act, 1882(2018) 8 marks
Q. Explain clearly provisions relating to disabilities and removal of trustees(2019) 8 marks
Q. Define trustee. Also discuss the various duties and liabilities of trustee as prescribed under the
Indian Trust act, 1882(2022) 8 marks

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AIR 1960 SC 100