Section 328: Provisions relating to vacancy in office of trustee

1) The office of the trustee shall fall vacancy in any of the following circumstances:

(a) If the person is not qualified to be a trustee,

(b) If the person resigns from the office of a trustee,

(c) If the person dies or becomes insolvent,

(d) If, in the case of a body corporate, it is dissolved, liquidated or becomes insolvent in accordance with law,

(e) If a trust is established for a certain period and such a period is completed,

(f) If the trustee is appointed for a certain tenure and such a tenure is completed,

(g) If the trust founder or court removes the trustee on the ground that he or she has embezzled the trust property or has not taken a reasonable care of (herchaha) such property.

2) If the office of a trustee has fallen vacant pursuant to sub-section (1), such an office shall be filled in accordance with the procedures set forth in the memorandum of incorporation.

3) If the office of trustee cannot be fulfilled pursuant to sub-section (2), the beneficiary, if available, and the concerned Local Level, if there is no beneficiary or the beneficiary cannot be identified, shall make an application, accompanied by a list of possible candidates, to the concerned District Court for the appointment of a trustee.

4) If an application is made for the appointment of a trustee pursuant to sub-section (3), the District Court shall appoint to the office of trustee an appropriate person from the list of candidates provided by the applicant, in consonance with the spirit of the memorandum of incorporation.

5) If any trustee is relieved of his or her office by virtue of the circumstance referred to in sub-section (1), he or she shall, as promptly as possible, hand over the trust property in his or her custody, control or use to other trustees. He or she shall not get immunity from any kind of liability or legal action for any act done or action taken by him or her while in office as a trustee by reason only that he or she has been so relieved of office.

Provided that if all trustees are relieved of office, such property shall be transferred after the appointment of another trustee.

6) If the office of a trustee of a public trust with only one trustee falls vacant or is filled pursuant to this Section, information thereof shall be given to the registrar.