Can trustees ever receive remuneration from the trust? (The fiduciary relationship and its obligations)-FS Flashcards
(10 cards)
What is the general rule regarding trustee remuneration?
Trustees are generally not entitled to receive remuneration for their services unless there is a specific provision allowing it.
What legislation altered the traditional rule that trustees could not be remunerated?
The Trustee Act 2000, specifically Sections 28 and 29, introduced provisions allowing trustee remuneration in certain circumstances.
Under what condition can a trustee be paid according to Section 28 of the Trustee Act 2000?
If there is a provision in the trust instrument that permits it, or if the trustee is a trust corporation or acting in a professional capacity.
Can lay trustees be paid under Section 28 of the Trustee Act 2000?
No, unless there is express consent from all beneficiaries of full age and capacity, or a court order authorising remuneration.
What is required for a professional trustee to be remunerated under Section 29?
All other trustees must provide their written agreement for the professional trustee to receive payment.
Can trustees be paid if the trust instrument prohibits remuneration?
No. If the trust instrument expressly prohibits remuneration, then no trustee may be paid from trust funds, regardless of status.
What alternative options exist for lay trustees who need help managing a complex trust?
They may seek a court order authorising remuneration or appoint a professional trustee who can be paid under Section 28.
What is meant by “reasonable remuneration” under Section 29(3) of the Trustee Act 2000?
Remuneration must be proportionate and justifiable based on the circumstances, such as the level of expertise and the work performed.
Can trustees be remunerated if beneficiaries over 18 all consent?
Yes, if all beneficiaries are of full age and capacity, their informed consent allows trustees to receive remuneration under common law.
Why does the law now allow some trustees to be remunerated?
To recognise the burden placed on trustees managing large or complex trusts, and to ensure qualified professionals can be fairly compensated
