DUTIES OF TRUSTEES

DUTIES OF TRUSTEES

1. s1 TA 00 statutory duty of care

   • Sch1 Application of duty of care
     • Duty doesn't apply if contrary provision in will
       • RE WHITELEY common law duty then applies
         • Ordinary prudent person of business
   • Duty to act fairly for both life tenant and remainderman

2. s3 TA 00 Trustees can invest in same kind of investments as absolute owner

   • Subject to exception of Land, comes under s8 TA 00
   • Must have regard to 'Standard Investment Criteria' s4
     • Suitability
       • Diversity

3. s5 TA 00 Must obtain proper advice

   • Remember s5(3) Unnecessary or inappropriate & (4) qualified person to give that advice

4. If trust includes controlling interest in company

   • RE LUCKINGS WILL TRUST get a place on the board or receive all the info a member would have
     • Consider the advice and act on it
     • If trustee does not act proactively, can be held personally liable to the trust
       • DEFENCE only if acted honestly and reasonably and ought fairly to be excused
         • s61` TA 1925

5. s31 TA 1925 powers of maintenance. In respect of a minor's maintenance, education or benefit

   • A discretionary power
     • Paid from the income so for the person with life/vested interest
       • WELLESLEY v WELLESLEY Court has authority to allow payment of maintenance out of minor's property

6. s32 TA 1925 power of advancement. For the beneficiaries benefit

   • PILKINGTON v IRC for requirement for advancement. Must improve the material situation of the beneficiary OR establish him in life
   • Paid from Capital, so for the remainderman/contingent interest
     • But remember no advancement that may prejudice the life tenant
       • Unless sui juris and consent in writing otherwise no advancement
         • Life tenant cannot apply for advancement of capital