Who are Trustees?
The assets in your Trust are no longer under your direct control. They will now be owned by and in the name of your trustees.
It is essential therefore that your trustees are chosen in the knowledge that they are trustworthy and will generally speaking carry out the wishes of the Settlor.
There are a number of questions about trustees which commonly arise:
There need to be at least two, but preferably not more than four, to avoid the Trust becoming unwieldy.
The modern trust deed requires that there be at all times at least one independent trustee, that is, a person who is not closely related to the Settlor. The independent trustee will thus usually be either a family friend or a professional such as an accountant or a solicitor.
Can the Settlor or another Beneficiary be a Trustee?
Yes, certainly. In very many Family Trusts the initial trustees are the husband and wife settlors and their professional advisor as the independent trustee. Sometimes adult children are appointed.
Change of Trustees
If for instance the independent trustee does not perform, or wishes to retire or resign, there will be power in the Trust Deed for the Settlors to “hire and fire” a trustee without giving reasons.
The principal way in which the Settlors can maintain control over the Trust is by
use of the power in the Trust Deed which enables them to be responsible for the appointment and retirement of trustees.
Are Trustees to be Paid?
This is a question for the Settlor. In most Family Trusts trustees are not paid, but if a professional trustee is appointed then he or she will normally charge usual fees for services supplied.
What is an Advisory Trustee?
An advisory trustee is a person appointed specifically to assist the trustees, usually in relation to some particular asset - eg if one of the Trust assets is a farm a person with farming xperience might be appointed as an advisory trustee. The advisory trustee will not be one of the trustees proper and his or her name will not be in the ownership papers of any of the assets.
Core Obligations of Trustees are to: