This story is exactly why you need a professional trustee

On behalf of Attwaters Jameson Hill posted in Trusts & Probate on Wednesday, April 17th, 2024

was placed into a trust until they reached the age of 25. The bequest was supposed to give them a head-start in life, to help them onto the property ladder or pay for their education. But when one of the Thomas sisters asked to access the money early in order to purchase a property with her boyfriend – something that Margaret’s Will allowed for –  they made a devastating discovery: their own mother, Katherine Hill, and their 93-year-old grandfather, Gerald, had already emptied the trust and stolen the girls’ inheritance.

The role of a trustee

A trust is essentially a legal arrangement that allows somebody (called the settlor) to hold money or assets for the benefit of somebody else (the beneficiary), often with conditions attached. The money or assets is looked after by a trustee or several trustees, who are responsible for the bequest until the conditions attached to the trust are met (for example, when the beneficiary comes of age).

According to the Law Society, a trustee’s role is to:

  • Deal with the assets according to the settlor’s wishes, as set out in the trust deed or their Will
  • Manage the trust on a day-to-day basis and pay any tax due
  • Decide how to invest or use the trust’s assets.

Being named as a trustee is a big responsibility and the trust’s settlor should only choose people they feel they can truly rely on. Sadly, Margaret’s choice of trustees would turn out to be a big mistake. Instead of investing the money sensibly as they had been advised by solicitors, Katherine and Gerald placed it into an easy-access savings account in their name, with the consequence that the girls’ money was frittered away in just a year.

In the court case that followed, prosecutors said that the pair acted out of “greed and spite” and the judge found them guilty of fraud by abuse of position. They are due to be sentenced on 31 May 2024.

The benefit of a professional trustee

As the above story shows, a trust will only protect your assets according to your wishes if the trustees you have chosen properly carry out their responsibilities. Furthermore, it shows that there can be severe legal consequences for trustees who fail to perform their duties as set out by the law. A court of law will not accept ignorance as an excuse for a trustee failing to exercise their duties.

One of the best ways to ensure your trust is properly managed and that all regulations are complied with is to use a professional trustee. A professional trustee will usually be a independent legal professional such as a solicitor, who is named as a trustee either alone or with one or more co-trustees.

A professional trustee will have the benefit of years of expertise in trust law, and will have an excellent understanding of how to best administer the trust in accordance with the settlor’s wishes. In addition, the administration associated with managing trusts has become more burdensome in recent years, something that a lay trustee may find complex and difficult to deal with. A professional trustee will take care of all the paperwork and responsibilities associated with running a trust. They can also act as a neutral party in the event of any dispute between the trustees as to how to manage the trust’s assets.

A professional trustee can also be very useful in the administration of Court of Protection and Personal Injury Trusts, which protect money and assets on behalf of people who lack mental capacity or are otherwise unable to make their own decisions. In these cases, professional trustees can help ensure that vulnerable people are not taken advantage of and that their money is used in accordance with their best interests.

Our professional trustee service

At Attwaters Jameson Hill, our Trusts & Tax and Court of Protection professionals have a wealth of experience in acting as professional trustees for a wide range of clients. Their specialist knowledge of trust law and administration gives our clients and trust beneficiaries the peace of mind that their assets will be protected in full accordance with the trust terms.

To speak with us about our professional trustee services, please give us a call on 0330 221 8855 or email enquiries@attwaters.co.uk

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