Trustee best practice – Trust Position Summary

Published October 27, 2016

One challenge for trustees serving across many trusts, is being able to quickly access an accurate high-level overview or context for each trust in which they serve.

Experienced trustees will recognise that each trust deed has its own wrinkles and potential fishhooks.  It takes time to reacquaint yourself with the context, parties, property and key terms of a trust.

To stay on track and overcome this problem, prepare a Trust Position Summary or TPS.  It’s a bit like a map with the geography, landmarks and arterial routes from which you can establish and maintain your position.

Investing time in preparing a TPS pays off – not only from your own perspective, but also for any co-trustees you work with.  It becomes the starting place to get a quick summary or overview.

Unfortunately, too many trustees just aren’t acquainted with the key terms of their trusts.  I’ve written before about the importance of knowing the rules of a trust.

So what are the advantages of a Trust Position Summary?

The document is useful:

  1. As a reference point for decision making, or annual reviews
  2. For recording agreements and understandings between trustees
  3. For documenting trustee policies and how things work
  4. For inducting new trustees or trust administrators
  5. To educate beneficiaries on trustee roles and responsibilities

As with any document, a TPS needs to be kept up to date as circumstances can change.  That said, after the initial investment of time, maintaining it is generally easy.

What sorts of things go into a Trust Position Summary?

Some of the things you could consider include:

  • The Parties – settlors, trustees, beneficiaries, advisory trustees, advisers
  • A precis of the trust deed and rules for decision making
  • The trust purposes and a summary of the trust creator wishes
  • Recording trust property, insurances, tenancies, key dates, etc
  • Trustee policies for administration, investment or distribution
  • Trustee protocols and practices for decision making

The very process of documenting a TPS quickly identifies gaps, issues and concerns.  These present as wonderful opportunities to engage with the various parties to the trust.

If you’d like a sample of a TPS, send me an email and I’ll be happy to pass it on.

Trust good practice.

Lindsay

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