Ted & Maria

Ted and Maria had a trust which owned their family home, a commercial property and their share portfolio. Their lawyer had been their independent trustee for some time, but they had recently received a letter from him, saying that he was no longer taking on trusteeships and so wished to retire as trustee of their trust. Even though they had enjoyed working with their lawyer for a number of years, Ted and Maria thought that they would take the opportunity to look for a new lawyer who specialised in trusts and who could also be their independent trustee.
They were recommended a lawyer who specialised in trusts and went to meet with her. She told them about the upcoming changes to the Trusts Act and how important it would be that the administration of their trust was handled well going forward. She said that where her firm acted as trustee, they required their trust clients to have an annual meeting. Ted and Maria had never had an annual meeting before for their trust and asked what that involved. The lawyer said that they would be sent an agenda for the meeting and that the firm would prepare minutes of the meeting for their records. The things that would be discussed would include a review of their wills, memorandum of wishes for the trust and their enduring powers of attorney. At each meeting they would also review the reasons for the trust and talk about beneficiaries’ needs and possible distributions. Any improvements to trust property would be minuted and any money that Ted and Maria had put into the trust would be documented either by way of loan or gift. The trustees would consider the insurance in place for the trust assets to make sure it was adequate and also discuss any further insurance requirements such as life insurance over Ted and Maria’s lives. With the introduction of the new Trusts Act, the trustees would consider what information had been requested by beneficiaries and what information they should be volunteering to beneficiaries. They would also talk about the retention of trust documents and whose role it was to keep what. This sounded a lot more thorough than Ted and Maria had ever been before, but they could see the benefits in having a trustee who would really help them keep their trust as a separate entity and help them comply with the requirements under the new Act.

Issue 108 April 2020