Remove Trustees

Tears_of_the_Mushroom

So if a trust

• has one beneficiary
• the instrument is a will that applies the standard provisions of the Society of Trust and Estate Practitioners (1st Edition)
• there is no person nominated for the purpose of appointing new trustees by the will
• Section 19 of the Trusts of Land and Appointment of Trustees Act 1996 has not been excluded by the will.

Is it the case that the beneficiary can write a letter to both trustees telling them to retire from the trust and they have to follow that direction as the beneficiaries are unanimously agreed?
Would this result in the entire contents of the trust being transferred to the beneficiary?

Crabapple

Assuming the beneficiary is over 18 then yes.

But it would be best to wind up the trust and ask the trustees to appoint the assets out rather than simply retire.

Depending on the type of trust and assets there may be a need to report closure to HMRC.

securityguy

Yet again, Saunders v Vautier.

Tears_of_the_Mushroom

Okay thanks for the replies.

Now there is a part I didn't include in my first post, the trust was set up for a person with a metal health condition.
This condition is kept under control by medication and their carer (family member) makes sure that the medication is taken, no episodes caused by the condition have occurred in the last 10 years.
The trust was written into the will based on circumstances from more than 15 years ago and a letter of wishes accompanied the will stating that if the beneficiary is well and capable the full amount of the trust should be paid out to the beneficiary. (I know that the letter of wishes is not binding)

The trustees have made it clear that they do not intend to follow these wishes and will not pay out the trust in one lump to the beneficiary, this is likely due to a dispute that occurred during probate.

I know that capacity is a condition as well as being over the age of 18.
So would the metal health condition have a bearing on this?
Would the beneficiary need to prove they are capable to someone or would the trustees have to prove that the beneficiary is not capable?
Does this inevitably end up in court if an attempt is made to remove them in this fashion?

Yorkshireman99

Tears_of_the_Mushroom wrote: »

Okay thanks for the replies.

Now there is a part I didn't include in my first post, the trust was set up for a person with a metal health condition.
This condition is kept under control by medication and their carer (family member) makes sure that the medication is taken, no episodes caused by the condition have occurred in the last 10 years.
The trust was written into the will based on circumstances from more than 15 years ago and a letter of wishes accompanied the will stating that if the beneficiary is well and capable the full amount of the trust should be paid out to the beneficiary. (I know that the letter of wishes is not binding)

The trustees have made it clear that they do not intend to follow these wishes and will not pay out the trust in one lump to the beneficiary, this is likely due to a dispute that occurred during probate.

I know that capacity is a condition as well as being over the age of 18.
So would the metal health condition have a baring on this?
Would the beneficiary need to prove they are capable to someone or would the trustees have to prove that the beneficiary is not capable?
Does this inevitably end up in court if an attempt is made to remove them in this fashion?

Just because someone is suffering from a mental illness does not mean they lack capacity to manage their affairs. If they do have capacity then they can dismiss the trustees or take other action. Really they need paid for professional advice preferably from a STEP member. Ultimately the court can remove the trustees but hopefully it will not come that. The trustees are personally liable for the costs if they act unreasonably. Perhaps the Trustees should have it spelt out to them that it will hit tehri pockets if they do not act properly.

securityguy

"The trustees have made it clear that they do not intend to follow these wishes"

Then sadly, it would be for a court to adjudicate whether the trustees' actions were reasonable. The issue would hinge on whether the trust was deemed discretionary and whether the beneficiary was deemed capable. "this is likely due to a dispute that occurred during probate" tends to make one think that their actions are not reasonable within the terms of the trust.

Sounds like yet a another lesson in "trusts can make your estate much more complicated than it otherwise needs to be".

Yorkshireman99

securityguy wrote: »

"The trustees have made it clear that they do not intend to follow these wishes"

Then sadly, it would be for a court to adjudicate whether the trustees' actions were reasonable. The issue would hinge on whether the trust was deemed discretionary and whether the beneficiary was deemed capable. "this is likely due to a dispute that occurred during probate" tends to make one think that their actions are not reasonable within the terms of the trust.

Sounds like yet a another lesson in "trusts can make your estate much more complicated than it otherwise needs to be".

Not really. Trusts have their place. The real issue is in choosing the trustees wisely. Easier said than done.