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Trusts are supposed to make things easier — a clear plan for managing and distributing a family's assets without the delay and expense of probate. But when the person in charge of that trust, the trustee, stops acting in the family's best interest, a tool that was meant to prevent conflict can become the center of it. We represent Arkansas beneficiaries who've watched a sibling, stepparent, or other family member serving as trustee drain an account, favor themselves over other beneficiaries, or simply refuse to communicate about what's happening to money that isn't theirs.

At Duty Law, we help beneficiaries hold trustees accountable under Arkansas law — and in many of these cases, our goal is to get our client appointed as the new trustee in place of the person who's mismanaging the trust. This page explains how trust administration disputes typically unfold in Arkansas, what counts as trustee misconduct, how the legal process for removing a trustee works, and what a beneficiary should weigh before stepping into that role themselves.

What Trustees Are Supposed to Do

Arkansas trust law — codified in the Arkansas Trust Code — imposes real, enforceable duties on anyone who serves as trustee, whether they're a family member with no legal background or a professional fiduciary such as a bank or attorney. A trustee is required to act with undivided loyalty to the beneficiaries, meaning they cannot place their own interests above the trust's. They must manage trust assets prudently, with the same care, skill, and caution a reasonably prudent person would use, including diversifying investments rather than gambling the trust's future on a single asset or account. They must treat multiple beneficiaries impartially, balancing the interests of someone entitled to income now against someone entitled to what's left when the trust eventually terminates. And they must keep beneficiaries reasonably informed — sending an accounting at least once a year showing the trust's property, income, disbursements, and the trustee's own compensation.

These aren't vague aspirations — they're specific, enforceable obligations, and when a trustee ignores them, Arkansas law gives beneficiaries real tools to respond.

Signs a Trustee Is Mismanaging or Misusing a Trust

Not every disagreement with a trustee's decisions rises to the level of a legal violation, and Arkansas courts don't remove trustees over ordinary friction or beneficiaries simply wishing a trustee had made a different call. But certain patterns are consistently treated as red flags that something more serious is happening:

• Refusing to provide accountings or information. A trustee who won't answer basic questions about the trust's assets, won't provide the annual report the law requires, or goes silent when a beneficiary asks what's happening to the money is often hiding something — or at minimum, failing a core legal duty regardless of what's actually going on.

• Self-dealing. Using trust funds or property for the trustee's own benefit — paying personal expenses from the trust account, "borrowing" trust money without documented, arm's-length terms, or selling trust property to themselves or a family member below market value — is one of the clearest breaches of the duty of loyalty.

• Unequal or improper distributions. Favoring one beneficiary over another in ways not authorized by the trust document, or making distributions that don't follow the trust's actual terms, can be a breach even if the trustee genuinely believes they're doing what's fair.

• Commingling trust assets with personal funds. A trustee is required to keep trust property separate and properly identified. When trust and personal money get mixed together, it becomes difficult to track what happened to trust assets — which is often exactly the point when it's happening deliberately.

• Reckless or negligent management of trust property. Letting a rental property fall into disrepair, failing to insure trust assets, or making high-risk, undiversified investments with money meant to support a beneficiary for years can amount to a breach of the duty of prudence even without any dishonesty involved.

• Unreasonable delay. Sitting on distributions the trust clearly calls for, or dragging out administration for no good reason, can itself be grounds for a beneficiary to seek court intervention.

• Incapacity or inability to serve. Sometimes the issue isn't misconduct at all — a trustee's health, cognitive decline, or a move out of state can leave them unable to properly administer the trust, which is its own basis for seeking a change.

Legal Grounds for Removing a Trustee in Arkansas

Under the Arkansas Trust Code, a settlor, a co-trustee, or a beneficiary can ask the court to remove a trustee, and the court can also act on its own initiative. Arkansas law identifies several distinct grounds for removal:

1. A serious breach of trust. This is the most common basis in contested cases — misappropriation, self-dealing, or a clear violation of the trustee's fiduciary duties.

2. Lack of cooperation among co-trustees that substantially impairs the trust's administration, where multiple trustees are deadlocked or working against each other.

3. Unfitness, unwillingness, or persistent failure to administer the trust effectively, where the court determines removal best serves the beneficiaries' interests — this covers situations involving incapacity, chronic neglect, or a trustee who simply won't perform the role, even absent outright dishonesty.

4. A substantial change in circumstances, or a request from all qualified beneficiaries, where the court finds removal serves everyone's interests, isn't inconsistent with the trust's core purpose, and a suitable successor is available.

Because this list is fairly broad, Arkansas courts have real latitude to remove a trustee where the facts warrant it — but they also don't treat removal lightly. Courts generally expect clear evidence, not just a beneficiary's frustration or a personality conflict with the person serving as trustee.

When a client is concerned about the Trustee’s actions, we can open a Trust Administration case and issue subpoenas directly to banks and investment holders to authorize the receipt of bank records and statements to determine whether the Trustee has acted prudently or not. 

What a Court Can Do Beyond Removal

Removing the trustee isn't the only remedy available, and depending on the situation, it may not even be the first thing a court orders. When a beneficiary proves a breach of trust, Arkansas law authorizes the court to:

• Compel the trustee to properly perform their duties

• Order the trustee to pay a bond to continue serving as trustee

• Order the trustee to repay money, restore property, or otherwise redress the harm the breach caused

• Order the trustee to provide a full accounting

• Appoint a special fiduciary to take over administration, even before a final removal decision

• Suspend the trustee pending further proceedings

• Reduce or eliminate the trustee's compensation

• Void improper transactions, impose a lien or constructive trust on trust property, or trace and recover property the trustee wrongfully disposed of

In practice, this means a lawsuit against a mismanaging trustee often accomplishes more than just a change in who holds the title — it can also force the return of misused funds and undo transactions the trustee shouldn't have made in the first place. Trustees who breach their duties can also be held personally financially responsible, including having to repay the trust or the beneficiaries directly out of their own pocket.

How the Removal Process Works

1. Documenting the problem. Before filing anything, we work with the beneficiary to gather what's available — trust documents, any accountings that have been provided (or the record of requests that went unanswered), bank and account records if accessible, and a clear timeline of the trustee's conduct.

2. Requesting information directly, when appropriate. In some cases, a formal written demand for an accounting or specific information — citing the trustee's statutory duty to inform and report — can resolve simpler disputes, or at least establish a clear record of noncompliance if the trustee still refuses.

3. Filing a petition with the circuit court. The petition lays out the trustee's specific breaches, the harm to the trust and its beneficiaries, and the relief being requested — which may include removal, a full accounting, disgorgement of misused funds, and appointment of a specific successor trustee.

4. Seeking interim protection, if urgent. If trust assets are actively at risk — for example, an ongoing pattern of self-dealing or an imminent improper sale — the court can order interim relief, including suspending the trustee or appointing a special fiduciary, while the case is pending, rather than waiting for a final ruling before anything changes.

5. Discovery and the accounting fight. Much of the real work in these cases involves obtaining and analyzing the trustee's financial records to establish exactly what happened to trust assets, which often requires subpoenas to banks and financial institutions when the trustee hasn't voluntarily provided complete records.

6. Hearing or trial. If the matter isn't resolved by agreement, the court will hold a hearing to weigh the evidence and decide whether removal, financial remedies, or both are warranted.

7. Appointment of a successor trustee. If the court removes the trustee, it will look first to any successor named in the trust document. If none is named, is unwilling, or is unsuitable, the court can appoint a qualified individual — which is often where our client, as the beneficiary who brought the case forward and can be trusted to properly administer the trust, is appointed to take over.

Timelines vary widely. A straightforward case with clear documentation and a trustee willing to step aside voluntarily can resolve in a matter of months; a heavily contested case involving disputed accountings, missing records, or a trustee determined to fight removal can take considerably longer.

Should You Take Over as Trustee? Weighing the Risks and Benefits

For many clients, successfully removing a problem trustee is only half the story — the next question is whether they should be the one to step into that role. It's worth going in with clear eyes about what that actually involves.

The Benefits

• Direct control over protecting the trust's assets. Rather than relying on someone else to manage money that affects you or other family members, you're in a position to make sure the trust is administered properly going forward.

• The ability to correct course. A new trustee can often unwind some of the damage caused by a predecessor — pursuing recovery of misused funds, correcting improper investments, and restoring proper recordkeeping.

• Trustee compensation. Arkansas law generally allows a trustee to receive reasonable compensation for serving, which can offset some of the time and responsibility involved, depending on what the trust document says and what the court or beneficiaries agree is reasonable.

• Restoring family trust and transparency. For families where the previous trustee's silence or evasiveness has caused real strain, a new trustee committed to the reporting and communication duties the law requires can go a long way toward repairing relationships among beneficiaries.

The Risks

• You inherit the same fiduciary duties you just enforced against someone else. Once you're trustee, you're personally bound by the same duties of loyalty, prudence, impartiality, and disclosure — and you can be held to the same standard, including personal financial liability, if you fail to meet them.

• Ongoing time and administrative burden. Trust administration isn't a one-time task; it includes recordkeeping, annual accountings, tax filings, and ongoing decision-making, sometimes for years, depending on the trust's terms.

• Exposure to disputes from other beneficiaries. Serving as trustee can put you in the position of having to say no to a sibling or other beneficiary's request, which can create new friction even after the original problem trustee is gone.

• Potential conflicts if you're also a beneficiary. Arkansas's duty of impartiality applies even to a trustee who is themselves one of the trust's beneficiaries — you'll need to administer the trust for everyone's benefit, not just your own, and that balance needs to be handled carefully and well-documented.

• Complexity of the trust's specific assets. A trust holding real estate, a business interest, or complicated investments requires more active, informed management than a simple trust holding cash or marketable securities, and it's worth being realistic about whether you have the time, expertise, or willingness to bring in professional help where needed.

• If you've read this far, your concern must be genuine and we would highly recommend you not delay any further to protect trust assets.

We walk every client through this analysis before recommending they pursue appointment themselves. In some cases, the right answer is for our client to become trustee. In others, it makes more sense to have the court appoint a neutral professional or corporate trustee while our client remains active as a beneficiary with full information rights and oversight — without taking on the personal liability that comes with the role. 

Common Questions Beneficiaries Ask

How do I know if what my trustee is doing is actually illegal, or just something I disagree with? This is exactly the kind of question worth reviewing with an attorney before deciding how to proceed. Genuine breaches — self-dealing, refusing legally required accountings, commingling funds — are different from a trustee simply exercising discretion the trust gives them in a way you don't love. We help clients tell the difference and build the record needed if a real breach is happening.

I suspect the Trustee is not acting fairly, should I wait and see? Delay allows the trustee to drain accounts. We have seen trustees drain accounts quickly. It’s possible that your delay will leave the Trust with no money and only a lien to enforce if and when the Trustee has money in the future. The better move is to act fast - as soon as soon as the Trustmaker has passed away - so a judge can oversee the fair distribution of funds according to what the trust says.  

Can I get information about the trust before deciding whether to take legal action? Yes. Arkansas law generally entitles a qualified beneficiary to a copy of the trust instrument on request and to at least annual accountings for most trusts. If a trustee is refusing basic information you're legally entitled to, that refusal itself can be part of the case against them.

I am the Trustee, I just want to be sure I am following the Trust correctly. Can I open a trust case to resolve a dispute? Yes, you can definitely open a Trust Administration case for a judge to provide input as to what the Trust says when you have a question on how to administer the trust or enforce a provision. If you are working with beneficiaries that are not all in agreement with your actions, this is the best way to protect yourself from liability. 

What if the trustee is also a beneficiary and claims they're entitled to spend trust money on themselves? A trustee who is also a beneficiary can still only use trust assets in ways the trust document actually authorizes, and must treat other beneficiaries impartially — being a beneficiary doesn't give someone free rein over trust property once they've also taken on the role of trustee.

Will removing a trustee cost the trust a lot of money? It can, particularly in a contested case involving significant discovery. But when a trustee has misused meaningful trust assets, the potential recovery — plus the protection of the trust's remaining value going forward — often justifies the cost, and courts have the power to shift some costs and fees depending on the circumstances and the severity of the breach.

What happens to the trust while the case is pending? If assets appear to be at immediate risk, we can ask the court for interim protection — including suspending the current trustee or appointing a special fiduciary — so the situation doesn't get worse while the case works its way through the court.

I think the Trustee is doing a good job but I’m not happy with my share. What can I do? Some trusts contain a provision to disinherit anyone who contests the trust. If you don’t have a genuine issue with the trustee mismanaging money, it is likely best to leave it alone. A consultation with an attorney would be best to cover your options here. 

How Duty Law Can Help

We represent Arkansas beneficiaries who suspect — or have already confirmed — that a trustee is mismanaging or misusing trust assets. That includes demanding the accountings and information a trustee is legally required to provide, building the evidentiary record needed to prove a breach of trust, petitioning the court for removal and appropriate financial remedies, and, where it makes sense for our client, pursuing appointment as the successor trustee so the trust is finally administered the way it should have been from the start.

If you're a beneficiary who's lost confidence in how a family trust is being handled — whether that means unanswered questions, missing money, or a trustee who seems to be treating the trust as their own — contact Duty Law for a consultation. We'll help you understand what Arkansas law actually requires of your trustee, what your options are, and what it would realistically involve if you're considering stepping into that role yourself.

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This page is intended for general informational purposes and does not constitute legal advice. Every trust and every family situation is different, and the outcome of any trust administration dispute depends on its specific facts. Contact Duty Law directly to discuss the details of your situation.