Are trustees trustworthy?

We all say we trust our doctors with our lives, but how do we trust others with our money if we’re not around or able to manage that money?

This can be looked at from two points of view;
1. The trustees you appoint if it’s a trust you’re setting up and
2. The trustees looking after your money if you’re a beneficiary from a trust

Trust law is extremely complex. If you have any doubts you should take professional advice, but this may prove costly.

Trustees have a number of powers, duties and responsibilities. In applying any investment powers they may have, the trustees have got to think about the correctness of the investments for all beneficiaries, keep them under evaluation and change them if suitable.

If you’re appointing trustees you need to appoint people who are going to be able to carry out the tasks you set them. It may be a trust in a will and you won’t be able to see over what they’re doing because for them to be working your trust, you’ll have died first.

You need to select people you trust to carry out the task just as you’d want it completing. You should speak with your trustees and ensure they know exactly what you expect of them, but always remember that when you’ve handed over the task, via a Will, for example, then it will be up to them to find the most suitable way to carry out your requests. Laws change and financial circumstances change. They’ll need to adapt to situations you might not have imagined.

If the trustees are managing money for you as a beneficiary of the trust, then you don’t have any say in what they’re doing, but if you feel they’re not acting correctly (to be polite) then you can go to court (as a last resort) and have a judge look at the trust and to analyze how they’re managing the trust. You should talk with the trustees first to raise your concerns.

If this is your chosen route, you’ll need to balance the cost of going to court against the potential gains you’ll (maybe) make.

Filed under: Legal Advice