Advice to Trustees

Advice to Trustees

In our experience, the duties and responsibilities of Trustees is often greatly underestimated by lay people and professionals alike.  If you are a Trustee, please consider carefully the role you have agreed to undertake and seek advice early and then regularly.

Questions we are often asked include:

• for decision-making, do all Trustees have to agree, or can a majority decision be sufficient?
• how is one supposed to act as a Trustee?
• should a Trustee always have a ‘cautious’ approach to investment?
• what are the duties of a Trustee for a life interest trust (interest in possession trust)?
• should all Trustees be named on Trust property at the Land Registry?
• what legal guidance is set out for how a Trustee should conduct him/herself towards beneficiaries?
• what happens where Trustees disagree on a decision?
• should Trustees delegate their financial duties to an experienced advisor?
• should Trustees take accountancy advice on tax implications for the Trust?
• what is required in terms of Trustee meetings and the Minuting of decisions?

We can seek to address and answer these questions and provide further guidance.

The truth is that in many cases, the scope of acting for Trustees is a wide one.  Most trusts contain flexible powers that enable each Trustee to act with a degree of freedom.  However, the extent to which that applies is defined within the Will or Trust instrument (Settlement).

Guidance by Government

The Trustee Act 2000 defines a range of requirements and helps to define part of the scope of responsibilities for Trustees.

The primary duties of care are twofold:

• to act in accordance with the purpose of the Trust as set out by the creator of the Trust (the Will-maker or the Settlor) and to respect any wishes and act in accordance with them; and
• to act with all care for the benefit of the Beneficiaries of the Trust. To act responsibly in the management of the functions.