PROTECTING YOUR ASSETS FOR FUTURE GENERATIONS

Trustee Services Stamford

This guide provides an overview of trustee powers and duties. It is intended for general information only and should not be considered a replacement for professional advice. Feel free to contact us for any assistance or guidance you may need.

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What is the definition of a Trust?

A Trust is a legal arrangement where assets are transferred by the Settlor (the individual or individuals who create the Trust) to Trustees, who manage these assets for the benefit of the Beneficiaries (those intended to inherit the assets).

This relationship between the Settlor, Trustees, and Beneficiaries establishes specific powers, duties, and obligations. The Trustees have a duty to follow the Settlor’s instructions and to ensure the Beneficiaries receive the appropriate assets according to the terms set out in the Trust Deed.

The Trustees are responsible for managing the Trust Fund and distributing the assets to the Beneficiaries in accordance with the Settlor’s wishes. If the Settlor has reserved certain rights, such as the right to occupy trust property, it is the Trustees’ duty to ensure these rights are upheld.

What are the duties of a Trustee?

The Trust Deed outlines the powers and duties of the Trustees. Trustees should carefully read and fully understand the Trust document, and where necessary, discuss its contents with other Trustees.

A fiduciary relationship exists between the Trustees, Beneficiaries, and sometimes the Settlor. In this context, a fiduciary relationship means that Trustees are legally obligated to act in the best interests of the Beneficiaries.

Trustees must ensure they have the appropriate ‘power’ to take any action on behalf of the Trust. This means the Trust or the relevant law must authorize their actions.

Trustee records and accounts are essential. Trustees are required to maintain accurate records of their decisions and actions to demonstrate they are managing the Trust properly. This could include keeping minutes of meetings held.

In cases where a Trust is created for property and the Settlor will remain in the property for the rest of their life, minimal action may be required. An initial set of minutes should be taken when the Trust is established, confirming that the Trustees have read and understood their responsibilities under the Trust Deed. Subsequent meetings may only be necessary if a significant change occurs, until the death of the Settlor.

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Who can be a Trustee?

To be a Trustee, individuals must be over 18 years old and possess the mental capacity to manage the Trust Fund effectively. Additionally, they should have a clean financial history, meaning they should not have been declared bankrupt or have faced penalties for financial misconduct.

Can a Beneficiary be a Trustee?

Yes, a Beneficiary can serve as a Trustee, provided that it does not result in a conflict of interest.

How many Trustees should there be?

It is recommended that there are at least two Trustees. Where land is involved, the land registry will only register a maximum of four on the land register. If the Trust property is sold, the signatures of 2 Trustees will be required to effect the sale. It is possible to have 1 Trustee, but an additional Trustee will need to be added at a later point if property is to be sold.

The number of trustees required for a Family Probate Trust typically depends on your preferences and the complexity of the trust. However, it is generally recommended to have at least two trustees to ensure proper management and decision-making. Having multiple trustees helps provide checks and balances, ensuring that decisions are made in the best interest of the beneficiaries. If you feel that establishing a Family Probate Trust may not align with your estate planning goals, you might consider using a Town & Country Law Protective Property Trust Will as an alternative.

If you need further guidance on these matters or have concerns about the legal aspects, please don’t hesitate to contact us.

Please note, some of the services we offer may involve reserved legal activity. This means that certain legal work must be carried out by an authorized professional in accordance with the Legal Services Act 2007. We work closely with a trusted firm of solicitors who can assist you with these matters, ensuring all regulatory obligations are met. For more details, please get in touch with us.