Very difficult situation regarding grandmother's will
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Manxman_in_exile wrote: »securityguy - don't want to go off at a tangent but can you explain this further please?
The will says that loans can be advanced to beneficiaries but that they need to be repaid. I don't see how this depletes the trust fund unless you are referring to 5.3.2 which permits the trustees to make payments to beneficiaries as they see fit (presumably without any obligation to be repaid). Is this what you mean because it wasn't obvious to me on first reading the will?
It's a discretionary trust. All the powers they are granted in the will simply extend to the trustees powers that might otherwise be right on the edge, even for a discretionary trust. So they can give unsecured interest free loans to beneficiaries, which might normally be seen to be wrong, even for a discretionary trust (interest is in part a payment for risk, so here's something risky with no payment). So the trustees can either give money to beneficiaries, or lend it to them interest free, it's up to the trustees.Also I understand that the trustees have discretion to make any payments to beneficiaries as they see fit, but is that discretion entirely unfettered? I mean they may be under no obligation to treat all the beneficiaries equally, but surely that doesn't mean they can exercise their discretion unfairly or unreasonably (by for example, deciding to distribute the fund to just one beneficiary)?
Yep, it means just that. There is probably stood right at the back some overarching trust law which prevents them from being manifestly unreasonable, arbitrary, whatever. But the clause excluding equality is pretty all-encompassing. I suspect that unless they can be shown to have acted in a manner which no reasonable person would countenance, they're in the clear.In an earlier post you also mentioned that guidance from grandmother to her trustees may exist outside the will, but what weight would that guidance have (if indeed it exists)?
Almost nothing. The whole point about trustees is that the testator trusted them. Certainly, the terms of the will would override it, and there's no obligation on the trustees to even read it, to keep a copy or to show it to you.0 -
That's the funny thing, because this will is now with its third trustee after the original one retired, and the second one moved companies and passed it on to a colleague of hers. So this trustee not only never know my grandmother even existed but also has no idea of her family or ties or anything whatsoever. So much for her being a trusted person who can decide where the best part of 100k is distributed.securityguy wrote: »Almost nothing. The whole point about trustees is that the testator trusted them. Certainly, the terms of the will would override it, and there's no obligation on the trustees to even read it, to keep a copy or to show it to you.0 -
That's the funny thing, because this will is now with its third trustee after the original one retired, and the second one moved companies and passed it on to a colleague of hers. So this trustee not only never know my grandmother even existed but also has no idea of her family or ties or anything whatsoever. So much for her being a trusted person who can decide where the best part of 100k is distributed.
Anyone clever enough to set up a trust like this is clever enough to not set up a trust like this. The very act of doing it proves you shouldn't be doing it.
More specifically, succession planning in long-term trusts is really, really hard.0 -
It can be done but the average High Street, non specialist solicitor, simply does not have the specialist knowledge and experience to do it. A STEP member should be able to but the difficulty is covering all the possible variables let alone finding a willing, and competent, trustee. It will not come cheap to set up, and the ongoing costs are likely to be high as well. Really it something for the wealthy, say £1,000,000 upwards, estate where the IHT savings can really justify a professional trustee.securityguy wrote: »Anyone clever enough to set up a trust like this is clever enough to not set up a trust like this. The very act of doing it proves you shouldn't be doing it.
More specifically, succession planning in long-term trusts is really, really hard.0 -
securityguy wrote: »
There is probably stood right at the back some overarching trust law which prevents them from being manifestly unreasonable, arbitrary, whatever. But the clause excluding equality is pretty all-encompassing. I suspect that unless they can be shown to have acted in a manner which no reasonable person would countenance, they're in the clear.
The whole point about trustees is that the testator trusted them.
Thanks for the reply.
1. As (if I recall correctly) trust law grew out of Equity I would have thought there must be some principle to prevent discretionary trustees from acting (wholly?) unreasonably or arbitrarily. But I can no longer remember what that might be.
2. And that's why it's a "trust".That's the funny thing, because this will is now with its third trustee after the original one retired, and the second one moved companies and passed it on to a colleague of hers. So this trustee not only never know my grandmother even existed but also has no idea of her family or ties or anything whatsoever. So much for her being a trusted person who can decide where the best part of 100k is distributed.
Yes - it's a strange situation and gives the word "trust" a meaning that not many would attribute to it.0 -
Yorkshireman99 wrote: »Really it something for the wealthy, say £1,000,000 upwards, estate where the IHT savings can really justify a professional trustee.
And those sorts of trusts aren't set up to play ad hoc "well, if you really need it, ask nicely and we'll see" games with grandchildren and then be wound up.
An acquaintance who is the beneficiary of a trust set up by a relative decades ago just gets their share of the income on some assets, less some retained within the trust for contingencies. The effect is as though they owned some shares, without having the right to sell the shares. The trustees' job is to maintain the value of the assets and maintain the income stream they generate; they aren't interested in who they're paying the income to, or what those recipients do with it, just that they pay out the surplus. Running a trust like that isn't cheap, but is pretty standard: the trustees have to make investment decisions, but they don't have to do anything about the payments beyond cutting the cheques.0 -
This trustee appears to be making up her own rules regarding who can and cannot access the funds, regardless of what is stated in the will.
If she refuses my request for an equal share of what's remaining, is there no action I could take? After all, there is nothing in there to suggest she is obliged to reject my requests at a certain age.
Surely if my request follows the rules stated in the will, and I am not asking anything unreasonable such as "I'd like the remaining funds transferred to me as soon as possible" then she has no genuine reason to reject my request?
Regardless, due to her comments last week about X and Y have access to the funds only, I fear she'll reject my next request.
What could I do then?0 -
Manxman_in_exile wrote: »Yes - it's a strange situation and gives the word "trust" a meaning that not many would attribute to it.
In computer security, we talk about "trusted systems" and the "trusted computing base". The TCB is the set of components in a system which you are relying on to provide the security. So for example, all bets are off the table if the attacker can make the CPU in your computer subtract when it should be adding, so one component in the TCB is the CPU: you're trusting it to execute instructions faithfully.
The bit that catches people out is that this statement doesn't mean that the CPU is trustworthy; it just means that you are trusting it. When you make a list of the parts of a computer system that are trusted, that says nothing about whether that trust is well-placed. A lot of money is spent on actually checking whether the trust is well-placed ("assurance" of operating systems and CPUs is savagely expensive) and as a corollary of that removing elements from the TCB, so you can say "it doesn't matter if this bit is compromised, it isn't trusted" is a target of many security projects.
In this case, there is a trust, and it has trustees. That doesn't mean they are trust-worthy, either from the perspective of the beneficiaries or the creator of the trust. But they have the power.0 -
Thank you. I like that pragmatic explanation.0
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OP - I think if I were you I'd try the approach suggested by Malthusian in #45. (But I think I would wait until I've received the will from the probate registry to make sure it is identical to the copy your mother has).
Then see what the trustee says. They may say "OK".0
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