Trustee Powers and Duties Flashcards
What are trustee powers?
What trustees may do
What are trustee duties?
What trustees must do
What do administrative powers/duties relate to?
Management of trust property
What do dispositive powers/duties relate to?
Distribution of trust property
What are the statutory administrative powers and duties?
General power of investment
Power to acquire land
Power of delegation
What power do trustees have under the general power of investment?
make any investment that they could if they were absolutely entitled to the assets
What are the considerations when exercising the general power of investment?
Standard investment criteria
Advice
Duty of care
What are the two key compenents of the standard investment criteria?
Suitability
Diversification
What is considered about the trust fund for the standard criteria?
size of trust fund
period of time intended to subsist
respective rights of beneficiaries
What were the considerations in cowan v scargill?
- beneficiaries’ financial best interests
- balance interests of all beneficiaries
- personal view irrelevant
- moral and ethical considerations rare
- can’t ignore advice if disagree
When may a trustee ignore advice on investments?
Reasonably prudent trustee would do the same
When can trustees prefer an ethical investment?
straightforward choice between two investments of economical equivalence
When can trustees make an ethical investment taking into account the views of beneficiaries?
where the beneficiaries are all of sound mind and agree on the decision
When can trustees make non financial considerations?
charitable trustees where might conflict with charity aims/work
When must trustees obtain proper advice on investments?
Before exercising power and when reviewing
What are the requirements for someone giving proper advice under s5 TA 2000?
- reasonably believed by the trustee to be qualified to give it
- by ability in and practical experience of financial and other matters relating to the proposed investment
What is the exception for giving proper advice?
reasonably conclude in all the circumstances unnecessary
What is the statutory duty of care for the general power of investment?
such care and skill as is reasonable in the circumstances
What are the further specialist requirements of the duty of care for the general power of investment?
- special knowledge or experience trustee has/holds themselves out
- professional trustees - special knowledge or experience reasonably expected
Where can trustees acquire land?
In the uk
What powers can be delegated?
powers of investment
powers to acquire land
Who can trustees not delegate to?
Beneficiaries
How must trustees delegate the power to invest?
by an agreement in writing
What should the delegation of investment agreement include?
term ensuring compliance with written policy statement
