The long-awaited Trusts Bill is now the Trusts Act 2019 (“the Act”), having passed into law on 30 July 2019.
Anyone involved with a trust now has until 30 January 2021 to prepare for the changes as the new legislation will come into effect on that date.
Much of the Act updates and restates law that exists either in statute or in the case law, however there are a number of changes which everyone dealing with trusts needs to be aware of:
- Mandatory duties
The Act codifies both mandatory and default duties for trustees. The default duties will need to be expressly negated if you do not want to be bound by them.
- Beneficiary information
The Act provides the premise that information will be provided to beneficiaries
- Incapacitated Trustees
New provisions relating to how incapacitated trustees will be dealt with have been introduced.
- Appointment and Removal of Trustees
The Act provides several amendments in relation to the process for appointing and removing trustees.
- Review of Trustees’ Decisions
Under the Act, a beneficiary will be able to apply to the High Court to review any action, omission or decision of a trustee.
- The lifetime of a trust
The Act has abolished the rule against perpetuities, and instead the maximum duration of a trust will be 125 years.
- Alternative Dispute Resolution
The Act provides that disputes can be referred to alternative dispute resolution in some instances.
The current legislation relating to trusts is very out of date. The new Act provides solutions for many of the problems that arise for those who deal with family trusts.
Because the Act also contains new obligations, it is essential that before the changes come into force, trusts are reviewed for compliance. At Morrison Kent, we have the resources and the systems to ensure that complying with the new requirements for trusts will be simple and straight forward.
For more information
If you have a trust (or are thinking of forming a trust), get in touch to discuss how the new Act could affect you. We can prepare your trust for the new era in good time before issues arise.