Trust Disputes

A trustee is legally responsible for assets held in a trust and is required to manage the trust in accordance with the settlor’s wishes (the settlor is the person whose monies/assets were placed into the trust). The powers of the trustee are provided by law and will also normally be set out in the will or trust deed.

A trustee must:

• Deal with and manage the trust in accordance with the will or trust deed (including deciding how to use and invest the trust property/monies)
• Act impartially and fairly to all beneficiaries;
• Act with reasonable care and skill;
• Ensure trust assets are secure (including insuring trust property);
• Keep sufficient records in order to show that the trust has been managed properly;
• Not benefit himself/herself

Trustees typically have the following powers:

• To delegate certain powers to professional bodies (such as solicitors or accountants);
• To be paid for their work (but only where they are a professional trustee, such as a solicitor or accountant).

Where a trustee is in breach of trust (for example for failing to comply with the terms of the trust or breaching their fiduciary duty) the trustee has a personal liability to pay the trust/the beneficiaries for any losses suffered. The trustee may also be removed from their role.

In certain circumstances trustees can be removed from their role. The trust document should be checked first to see if a power to remove trustees has been given or reserved. Otherwise, unless the trustee agrees to retire, you may have to apply to the Court to seek the trustee’s removal.  Before hitting the nuclear button of an application to Court, it is important to explore all other avenues in order to ascertain whether or not the Court is the right forum or whether there is a less draconian method of resolving the issues.