Appointment of New Trustees UK: Trustee Act 1925 Powers Explained

Updated: 19 May 2026 • Reading time: 7 min

Every trust needs trustees — and trustees change. They die, lose mental capacity, move abroad, or simply wish to step down. When a trustee leaves, the trust does not come to an end; instead, a replacement must be appointed so the trust can continue to be administered properly. In England and Wales, the rules governing this process are set out primarily in the Trustee Act 1925 — in particular sections 36 and 41 — supplemented by the Trusts of Land and Appointment of Trustees Act 1996 (TLATA 1996). Understanding who holds the power to appoint, what triggers it, and how trust property passes to the incoming trustee is essential for anyone creating or administering a will trust.

When a Trustee Must Be Replaced

Section 36(1) of the Trustee Act 1925 sets out the circumstances in which a trustee can — and in practice must — be replaced. The power to appoint a new trustee arises where an existing trustee:

• Dies — the most common trigger. If a co-trustee survives, the surviving trustee can continue to act but should appoint a replacement promptly, particularly where the trust holds land.
• Lacks mental capacity — established under the Mental Capacity Act 2005. A trustee who lacks capacity to manage their own affairs cannot perform trustee functions. An attorney acting under a lasting power of attorney for property and financial affairs can sometimes act for the incapacitated trustee in limited circumstances, but it is generally preferable to replace the incapacitated trustee under section 36 so the trust can be administered by a fully capable trustee.
• Remains out of the United Kingdom for more than 12 months — under section 36(1) of the 1925 Act. Prolonged absence does not terminate the trusteeship automatically, but it gives the person holding the power of appointment grounds to act.
• Refuses to act or is unfit to act — a trustee who declines to execute their duties, is bankrupt (relevant to certain types of trustee), or is otherwise unfit can be replaced. A trustee convicted of a serious criminal offence or found to have committed fraud against the trust would fall in this category.
• Wishes to be discharged — a trustee who no longer wishes to serve can retire voluntarily under section 39 of the 1925 Act (if at least two trustees remain or a trust corporation takes over) or in conjunction with the appointment of a successor.

A practical limit on trustee numbers also applies where the trust holds land. Section 34 of the Trustee Act 1925 (as amended by TLATA 1996 and the Land Registration Act 2002) caps the number of trustees who can hold a legal estate in land at four. An appointment purporting to create a fifth trustee of land simply takes effect as to the first four persons named. There is no such statutory ceiling for trusts of pure personalty, though keeping the number manageable is sensible for practical governance reasons.

Who Holds the Power to Appoint: Section 36 Trustee Act 1925

The power to appoint new trustees under section 36 follows a strict hierarchy:

1. The person nominated in the trust instrument — a well-drafted trust deed or will often appoints a named individual (sometimes called the “protector” or simply “the person with the power of appointment”) who holds the exclusive power to appoint and remove trustees. This person need not be a trustee themselves. Where such a nomination exists, it takes priority over all other mechanisms.
2. The surviving or continuing trustees — if no nomination is made in the trust instrument, the power falls to the trustees who remain in office. A sole continuing trustee can appoint a new co-trustee. Crucially, a trustee who is themselves being replaced by the appointment is treated as a “continuing” trustee for the purpose of joining in the deed of appointment — so the outgoing trustee should sign the appointment as well as the retirement deed.
3. The personal representatives of the last surviving trustee — where all trustees have died, the power passes to the PRs of the last trustee to die. This prevents a trust from becoming unworkable simply because all trustees have died.

Section 36(6A) of the Trustee Act 1925, inserted by TLATA 1996, gives a parallel right to beneficiaries. Where all beneficiaries are of full age and mental capacity, are between them absolutely entitled to the entire trust fund, and unanimously agree, they may direct the trustees to appoint a specified person as new trustee or to retire in favour of a new trustee. This power — sometimes called the “Saunders v Vautier right” in its wider form — gives adult absolutely entitled beneficiaries significant control over who administers their trust. It is separate from (and does not displace) the section 36 appointment mechanism, but it can be exercised instead where the trustees and nominated persons are unwilling to act.

Court Appointment: Section 41 Trustee Act 1925

Where none of the persons identified under section 36 can or will exercise the power of appointment, the court may appoint a new trustee under section 41 of the Trustee Act 1925. The court has a broad jurisdiction to do so whenever it is expedient to appoint a new trustee or where it is found inexpedient, difficult, or impracticable to do so without the court’s assistance.

Circumstances that may require a section 41 application include:

• All trustees have died with no personal representatives, leaving no one with power under section 36 to make the appointment
• Deadlock — where co-trustees disagree irreconcilably about the appointment of a replacement and neither is willing to act alone
• The trust instrument creates an unclear or unworkable nomination provision
• A trustee lacks capacity but has no personal representative or attorney authorised to join in a section 36 appointment

Section 41 is a last resort. It involves making an application to the Chancery Division of the High Court (or, for smaller trusts, the County Court) and is accordingly more expensive and time-consuming than a straightforward section 36 deed. In the vast majority of real-world cases, section 36 covers the situation adequately, either through continuing trustees, a nominated person, or the PRs of the last surviving trustee.

The Deed of Appointment and Retirement

An appointment of a new trustee under section 36 must be made by deed. A written document that is not executed as a deed — signed, witnessed, and delivered — is ineffective. The formalities for deeds are set out in section 1 of the Law of Property (Miscellaneous Provisions) Act 1989: the document must make clear it is intended to be a deed, must be signed by the grantor in the presence of a witness who attests the signature, and must be delivered (either physically or constructively). The witness must be independent — a beneficiary of the trust should not act as witness to a trustee’s signature.

In practice, a deed of appointment and retirement typically contains:

• Identification of the trust and the original trust instrument
• Recital of the ground for replacement (e.g. death of a co-trustee, desire to retire)
• Appointment of the new trustee by the person or persons exercising the section 36 power
• Retirement of the outgoing trustee (if still living and capable of signing)
• Acceptance by the incoming trustee of the appointment
• A vesting declaration (see section 5 below)

All signatures should be obtained simultaneously where possible — or at least the deed should be held undated and undelivered until all parties have signed. The incoming trustee should take a copy of the trust deed and all previous deeds of appointment before accepting, so they understand the terms of the trust they are joining and can take independent legal advice if appropriate.

Vesting: Section 40 Trustee Act 1925

One of the most practically important features of the statutory appointment mechanism is the automatic vesting provision in section 40 of the Trustee Act 1925. Under section 40(1)(b), trust property automatically vests in the new trustees by virtue of the deed of appointment itself, without the need for a separate transfer deed or conveyance. This saves considerable cost and administrative burden where a trust holds many assets.

However, section 40 contains important exceptions — certain types of property do not vest automatically and require additional steps:

• Registered land — legal title to registered freehold or leasehold land is only transferred when the new trustees are registered as proprietors at HM Land Registry. Until registration, legal title remains in the names of the outgoing trustees (or, if they have died, their personal representatives) even though the trust has been validly constituted with the new trustees. An AP1 form and supporting evidence (the deed of appointment, evidence of death if applicable) must be lodged with HMLR.
• Shares and securities — legal title to shares in a company does not pass automatically by the deed of appointment. A stock transfer form must be executed in favour of the new trustees, and the company’s register of members updated accordingly. For shares held through CREST or a nominee, the relevant instructions must be given to the nominee or registrar.
• Mortgages — the benefit of a mortgage held as a trust asset requires a separate legal assignment to the new trustees.
• Leases with alienation restrictions — some leases contain clauses that prohibit assignment without the landlord’s consent; a vesting of the lease in new trustees may technically require consent, depending on the precise wording of the restriction.

In practice, the deed of appointment will include a vesting declaration that expressly declares that all trust property (other than the excepted categories) vests in the new trustees, and the parties then take the separate steps needed for registered land, shares, and any other non-automatically vesting assets.

Testamentary Trusts and Trustee Succession

A testamentary trust is a trust created by a will, taking effect on the testator’s death. Common examples include trusts for minor beneficiaries (where the child cannot hold property directly until they reach 18), life interest trusts for a surviving spouse, and discretionary family trusts created to manage an inheritance over the long term.

Because a testamentary trust may endure for many years — potentially for a generation or more — trustee succession is a critical drafting consideration. A well-drafted will should:

• Name at least two initial trustees — often the same persons named as executors, so that on proving the will the executors automatically become the first trustees and the trust is constituted without any further step.
• Include an express power to appoint new trustees — although section 36 provides a statutory power, an express power can be drafted more broadly (for example, allowing appointment by a named protector, or by a majority rather than unanimous decision of continuing trustees).
• Consider a professional trustee — naming a solicitor or trust corporation as a trustee (or as a replacement trustee) provides continuity and professional administration, particularly for larger or more complex estates.

The TLATA 1996 also introduced a statutory right for beneficiaries under section 19. Where all the beneficiaries under a trust are of full age and mental capacity and together are absolutely entitled to the trust fund, they can give a written direction to the trustees requiring them to retire from the trust in favour of a person or persons specified in the direction — or to appoint a person as new trustee. This is a powerful right that gives adult absolutely entitled beneficiaries effective control over who administers their trust, even where the trust instrument is silent on the point.

Frequently Asked Questions