The new Trusts Act and its implications for Trustees
The Trusts Act 2019 (Act) comes into effect in January 2021, providing the first major reform to trust law in over 70 years. Although the Act implements significant changes, the over-arching purpose of the new legislation is to restate the existing law in a more accessible format, so that it can better assist beneficiaries in holding trustees to account.
The Act clearly sets out a range of obligations as well as a list of “Mandatory Duties” and “Default Duties” to follow. The obligations include a requirement for:
• every trustee to hold a copy of the trust deed and any variations
• at least one of the trustees must hold the rest of the “core trust documents”. N.B. the Act sets out what the core documents are.
As the name suggests, Mandatory Duties cannot be contracted out of, and therefore must be followed, whereas the Default Duties can be modified or excluded in appropriate circumstances.