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When a trust is created, the person in control and in charge of the trust, ensuring its intentions are carried out according to the trust conditions, is called a trustee.
Trustee Responsibilities
A trustee has certain duties and responsibilities when dealing with the trust, making sure that they play an active role in all decisions made, acting in the best interest of the purpose of the trust and its beneficiaries. This means they must act with honesty, integrity, loyalty, and good faith.
A trustee will be liable for any breach of trust from the day of appointment. Because of this, before accepting the role as a trustee, the trustee must ensure that their circumstances won’t result in a conflict of interest. They must ensure they understand the full scope of the trust instrument and the documentation, its purpose, how it applies to the beneficiaries and their circumstances, and the responsibilities they will be taking on.
Trustee Obligations and Duties
A trustee must comply with all duties and instructions set out in the trust rules, working alongside and agreeing unanimously with all other trustees on the decisions made. The trustees must have readily prepared all information and documentation, including the full accounts and payments to the beneficiaries.
Trustee Powers
The powers of the trustees are dependent on what is stated in the trust deed. However, the usual powers include handling and dealing with the trust’s investments and land, any advancement of capital or maintenance. Trustees may also be given discretion, hold the power to withhold or suspend payments to beneficiaries, and in some cases, provide indemnity.
Can the Beneficiaries Remove the Trustees?
A trustee will be able to retire at any stage. They can only be removed in one of the circumstances set out in the Trusts of Lands and Appointment of Trustees Act 1996 (TOLATA) s.36. Read the legislation here or if the court retains inherent power to remove trustees.
What are the primary responsibilities of a trustee?
What powers do trustees have in managing a trust?
Trustees’ powers depend on the trust deed but typically include handling investments and land, advancing capital or maintenance, and sometimes withholding or suspending payments to beneficiaries. They may also have discretion and the power to provide indemnity.
How can beneficiaries remove a trustee from their position?
A trustee can be removed under certain circumstances set out in the Trusts of Lands and Appointment of Trustees Act 1996 (TOLATA) s.36 or by the inherent power of the court. Trustees can also retire voluntarily at any stage.
Here at Lawdit Solicitors, we can help with the complex and sometimes daunting ongoing administrative tasks of trusts for trustees. We can also assist beneficiaries in their rights to access the trust, making sure the trustees are performing their fiduciary duties. Contact our specialist team today to find out more.
