When creating a trust, either during lifetime or by Will, trustees are encouraged to sign a letter of wishes which set out how they would like the funds to be distributed. Although this is not binding, it is an invaluable guide to the trustees who should take account of these wishes. In addition, the trustees should also act in the best interests of the beneficiaries. Unless the trust deed states otherwise, such as a trustee having an overriding power of veto, a majority of the trustees normally determines the course of action to be taken in Scotland.
It is therefore important to consider the number of trustees being appointed so that a majority decision can be reached if a dispute arises. If however, as was the case here, there was a question over a breach of trust, the court may intervene in particular circumstances. As noted in the above case, however, court action is likely to be costly and time-consuming. Contact Us Request Case Evaluation. Can One Trustee Act Alone A single trust can be managed by more than one Trustee of equal powers and responsibilities.
Co-trustee duties and responsibilities include: 1. Co-managing the assets in the trust; inventorizing, investing, selling, reporting 2. Filling tax returns 3.
Working with trust attorneys to protect trust assets 4. Request Consultation. Attorney Profiles. Trustee and Co-Trustee Conflict When there is a conflict between the trustee and co-trustees, then the beneficiaries may petition to remove one or both in court, but again, it takes court action, which costs a lot of time and a lot of money. Are you a Trustor? Why Choose Us? Our firm can make a difference in your case!
It is not uncommon for trustees under a Trust to be in dispute at some time. The trustees must take care to consider the interest of the beneficiaries and the maintenance of the Trust fund as paramount and not to let personal issue cloud their judgment in their capacity as trustees. Trustees have the ability to make an application the Court under section 66 to resolve a dispute or to have themselves replaced as trustees under 51 of the Act.
No liability is assumed by the authors, or publishers, for any losses suffered by any person relying directly or indirectly upon this newsletter. It is recommended that clients should consult a senior representative of the firm before acting upon this information.
Life Tenancy Under a Will Trustee disputes sometimes arise when the life tenant under a will and one or more of the residuary beneficiaries are appointed executors and trustees. Balance of Power An important consideration then when considering the appointment of executors and trustees under the terms of a life-interest will, is to ensure that there is a balance of power between the parties. Conclusion It is not uncommon for trustees under a Trust to be in dispute at some time. Richard claims that the firearms were a gift from the father to him, so are not part of the estate.
To make this more complicated and expensive , Richard refused to give Rachel an inventory of the firearms, or permit an appraisal. Rachel is still prepared to work toward a solution that allows her brothers to keep the farm, but that is only possible if the value can be settled.
She proposes putting the farm up for sale, and giving Richard and Ronald an opportunity to match any arms-length offer. Rachel ultimately asked the court to remove Richard and Ronald and leave her as sole trustee. Richard and Ronald disputed her ability to do the job. This is a breach of their duties as trustees. That last point is a big hidden danger in estate planning. Any time one of a number of beneficiaries is named as a trustee, a conflict of interest might arise.
Although there are many good reasons to name one or more beneficiaries as trustees, this is sometimes a reason to select a trusted outsider.
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