Trustee best practice – trustee information packs

Published March 22, 2018

The terms for governing a trust are set out in the trust deed. Trustees are duty bound to know and act in accordance with the terms of their trust.

Each trust deed is different. Many contain unusual terms and sometimes hard to understand provisions.

As one of the core roles of a trustee is informed decision-making, the trust deed should always be the first point of call before a decision is made.

The new Trusts Bill requires all trustees to hold a copy of the trust deed (and any variations to the deed). While it sounds obvious, not all trustees do hold a copy.

I’d recommend preparing Trustee Information Packs. They could contain:

  • Trust Deed and any variations to the deed
  • Settlor wishes
  • Trust calendar – important dates or regular actions
  • Trustee names and contact information
  • Beneficiary names and contact information
  • Professional trustee engagement letter
  • Details of assets and liabilities
  • Agreed protocols for decision-making
  • Contracts and agreements (e.g. leases, guarantees, etc)
  • Insurance schedule
  • Investment policy statement and/or investment plan
  • Common trust terminology and trustee duties

You don’t need to wait for a new Act.  Professional trustees and advisers can take the lead in preparing these packs for co-trustees or clients.  It’s something tangible and a way to signal these documents are important.

I’ve found Trustee Information Packs can align trustee thinking and become a reference point for ongoing decision making.  A quick review of the trust terms can be a standing agenda item for trustee meetings.

Good practice = less risk.

Trust good practice.

 

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