§ 8.01-525.2.Substitution of another trustee by creditors.
Chapter 18.1. Assignments for Benefit of Creditors · Article 1. Assignment of Property · Last amended 2019 · Last verified July 16, 2026
In one sentenceLets a majority of the assignor’s unsecured creditors, counted by both number and amount, petition the court that would have jurisdiction over the assignor to substitute a different trustee for the one named in the deed, with the new trustee taking on all the original trustee’s rights and duties and required to reside in the county or city where most of the assigned property is located.
Full Text of § 8.01-525.2
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A majority of the unsecured creditors in number and amount of the assignor may agree in writing upon a trustee different from the one named in the deed of assignment, and upon petition to the court that would have jurisdiction if an action were brought against the assignor, such agreed trustee may be substituted in lieu of such named trustee with all of the rights, powers, and duties conferred upon such named trustee in the deed of assignment. The clerk of the court where the deed of assignment is recorded shall record such order presented by one of the parties and shall
include a reference to the order book and page where such deed is recorded, together with the name of the substituted trustee, and shall make proper indexing. The substitute trustee shall reside in the county or city in which the property that is conveyed in the deed of assignment or the greater portion thereof in value is located.
Plain-English Summary
The debtor picks the first trustee when executing a deed of assignment, but the creditors who have a stake in getting paid do not have to live with that choice forever. Section 8.01-525.2 gives them a path to change trustees.
It takes a real majority to do it: a majority of the unsecured creditors counted both by headcount and by the dollar amount they are owed, agreeing in writing on a replacement trustee. With that agreement in hand, they petition whichever court would have had jurisdiction if a lawsuit had been filed against the assignor, and the court can substitute the new trustee in with every right, power, and duty the original deed gave the one being replaced.
The clerk where the deed was originally recorded then records the substitution order, cross-referencing the book and page where the deed itself sits and indexing the new trustee’s name properly, so the public record stays accurate and traceable.
One residency requirement anchors the choice of substitute trustee: the person must live in the county or city where the assigned property, or the greater portion of it by value, is located, keeping the person managing the estate reasonably close to what is being managed.
Frequently Asked Questions
Who can petition to substitute a new trustee?
A majority of the unsecured creditors, counted by both number and amount, who agree in writing on a different trustee.
Which court hears the substitution petition?
The court that would have jurisdiction if an action were brought against the assignor.
What rights does the substituted trustee receive?
All the rights, powers, and duties conferred upon the originally named trustee in the deed of assignment.
What must the clerk do once a substitution order is entered?
Record the order, referencing the order book and page where the deed is recorded, together with the substitute trustee’s name, and index it properly.
Is there a residency requirement for the substitute trustee?
Yes, the substitute trustee must reside in the county or city where the conveyed property, or the greater portion of it in value, is located.
Amendment History
1924, p. 657; Michie Code 1942, § 5278c; Code 1950, § 55-157; 2014, c. 330; 2019, c. 712.
Source & verification. Section text and amendment history are
reproduced verbatim from the Code of Virginia, published by the
Code of Virginia, Virginia Division of Legislative Automated Systems. Last verified July 16, 2026.
· Official source
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