What are your duties as a Trustee?

When you have been appointed as a Trustee, you will have certain duties to carry out and obligations to comply with. If you do not comply, you may be held personally liable for any breaches of those duties.  One of those duties was reviewed in the recent case of Henchley v Thompson [2017] EWHC 225 (ch), where Chief Master Marsh had to consider the circumstances in which a Trustee will be ordered to account to the beneficiaries for his dealing with the trust assets.

In this particular case, the late Mr Henchley created two trusts during his lifetime; the Henchley Trust and the Children’s Trust.  The late Mr Henchley had married twice and had two children by his first marriage (Patricia and Vivien) and four by his second (Julian, Elizabeth, Claire and Alexander).  The Henchley Trust was held for the deceased’s second wife for life and on her death for all his children equally.  The Children’s Trust was held as to one half for Julian and Alexander on them attaining 21 and the other half for Elizabeth, Vivien and Claire for their lifetime and then for their children and so on until the end of the trust period.  The Defendant, Mr Thompson, had married one of the deceased’s daughters and was purportedly appointed as a Trustee of the Henchley Trust by Deed which was found to be invalid.  Although Mr Thompson’s appointment was ineffective, he was still a de facto trustee so those duties still applied.

The absolute minimum a Trustee must do is:

1)  Hold the trust assets and safeguard them;

2)  Provide information to the beneficiaries concerning the terms of the trust;

3)  Keep accurate accounts and records of the administration of the trust;

4)  Deal with tax arising and to report to HMRC (if applicable).

To “account” not only means to provide figures setting out assets, liabilities, income and expenditure but to actually account to the beneficiaries, record and detail what has happened during the trust administration to ensure that the Trustees have complied with the terms of the trust. 

If there is more than one Trustee acting, they may divide the duties between them but it -does not absolve the Trustees collectively from their duties to the beneficiaries”.

Bik-ki Irving is a partner at Myerson Solicitors and has years of experience dealing with high net worth individuals as well as those whose have more complicated circumstances or those with mental capacity issues. Bik-ki is known for her friendly and professional manner as well as her ability to communicate complex issues simply.

Bik-ki specialises in complex Wills and estate planning, Estate and Trust administrations and Lasting Powers of Attorney.  As well as being a full member of Solicitors for the Elderly (SFE), she is the regional co-ordinator for Staffordshire and Cheshire arranging training for other solicitors practicing in this area of law.

Bik-ki is also STEP (Society of Trusts and Estate Practitioners) accredited and a member of the Private Client Section with the Law Society.

Myerson Solicitors is an independent, top-tier-rated law firm based in Altrincham. This highly respected firm specialises in a variety of business and personal law services and offers an accessible, high-quality alternative to city centre and national law firms. Myerson represents businesses and individuals in Manchester, Cheshire, the UK, the EU and beyond.

bik-ki.irving@myerson.co.uk