• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Trust Law Reform Essay

Extracts from this document...

Introduction

Trust Law Reform Essay Current Law At present much of trust law derives from the common law. Under this a trustee is strictly liable when they act outside the terms of the trust deed or the general law, thus committing an Ultra Vires breach. This is so, even if they have acted honestly and in good faith. Proposal 1 Questionably this rule is unjustifiably strict. The Commission proposes1 that trustees should cease to be liable for this kind of breach of trust if they have "acted in good faith and taking all reasonable steps and making all reasonable enquires believed that the action was in their powers"2. This proposal aims to simplify the uncertain existing law and offers a greater level of protection to trustees acting honestly and in good faith. Nevertheless, lowering the standard of legal responsibility may have a detrimental effect on the beneficiaries. The Commission's position is that it is doubtful that it will limit the beneficiaries' right of recovery, apart from in the instance of unauthorised investment, which the commission states is unlikely to happen. Even though it is true that trustees have wide powers of investment, recent case law demonstrates that beneficiaries still have the need to claim under this ground of breach3. ...read more.

Middle

Thus it is submitted that the suggested reform in part (a) is rejected. (b) At present the law in not clear whether any higher standard of care is expected of professional trustees. The Commission proposes that "a trustee who acts in the course of his or her business or profession should in addition have to use any special knowledge or expertise that it is reasonable to expect of a member of that business or profession"11. This move by the Commission to link skills and knowledge as opposed to financial benefit is laudable. It has been said that the standard of care is designed to protect beneficiaries and it is entirely fortuitous whether they are professional12 or not, yet it is presumed that the standard of care is also designed to protect the truster and by the necessity of carrying out the trust purposes, the trustee. Consequently it seems reasonable to lay trustees that they should not be subject to the same standard of care as those who possess special knowledge or skills. It has previously been contested that trustees that are remunerated should be subject to a higher standard of care13 yet it seems more sensible to base the standard of care upon the level of skill and knowledge that the trustee claims to have. ...read more.

Conclusion

In relation to the section proposing whole or partial relief of the trustee, it is submitted that this is a necessary power for the court to have as each individual case that comes before the court will have different circumstances and thus require different degrees of relief. 0205429 Word count 1598 1 Scottish Law Commission Discussion Paper No 123 on Breach of Trust (September 2003) 2 ibid. Subparagraph 2 page 7 3 Public Trustee Gordon's Executor v Williams [2002] W.T.L.R. 45, this case illustrates the need for beneficiaries still to have a remedy against unauthorised investment by the trustee. 4 Douglas v Douglas's Trs (1867) 5 M 827 5 Raes v Meek (1889) 16 R (HL) 31 6 ibid per Lord Hershnell page 33 7 Knox v MacKinnon (1888) 15 R 83 8 Tibbert v McColl 1994 SLT 1227 9 Scottish Law Commission Discussion Paper No 123 on Breach of Trust (September 2003) page 15 10 Tibbert v McColl 1994 SLT 1227 11 Scottish Law Commission Discussion Paper No 123 on Breach of Trust (September 2003) page 17 12 Norrie and Scobbie, Trusts, Edinburgh 1991, pg 141 13 Jobson v Palmer [1983] 1 Ch 71 14 Cherry's Trs v Patrick (1911) 2 SLT 313, Aberdeen Railway Co v Blaikie Bros (1854) 1 Macq 461 15 Cherry's Trustees v Partick (1911) 2 SLT 313 1 ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our University Degree Equity & Trust Law section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related University Degree Equity & Trust Law essays

  1. Trusts and Equity Essay - Question 4

    Hence the group was not a section of the public but a private class and the trust was, therefore, not charitable. Similarly, the £100,000 could not be given as a bursary to the children as it would fail to fulfil the criteria to constitute a charitable purpose that it should be for public benefit.

  2. Free essay

    Equity & Trust

    All organisations must now obtain official recognition if they wish to avail themselves of the attendant benefits that charitable status brings.36 Applications are considered by the Charities Commission and applications for tax exemptions are likewise treated by the Inland Revenue; (the two organisations can and do work together on certain

  1. Equity Case Summaries

    The steps that have been taken in attempting to assign.. Have legal req been met? 2. Nature Of Assignment (a) Is there a method for transferring the legal pty at law? (b) If so, has that method been followed/completed? (c)

  2. Equity and trust

    Summers, J et all ( 2007) believes that several alternative approaches have been used to uphold gifts of this nature. To support this professor D. J. Hayton23points out,"... there is scope for the courts to uphold non-charitable purpose trusts if the settlor's trust instrument provides for a person with locus

  1. Constitution Of Trusts Problem Question - in order to decide whether Nixon is entitled ...

    it would be unconscionable for him to recall that gift as it happened in Pennington v Waine34. The court is unlikely to decide the latter, because the beneficiary in Pennington was instructed that no action was required on his part, and he has given consideration for the promise by becoming a director in the same company.

  2. In order to critically assess the way in which the law acts to resolve ...

    Thus, Mrs. Burns was left with nothing but a huge sum of legal costs after nineteen years of partnership where she had raised two children, performed household duties and contributed to household expense. It would be unfair to overlook the non-financial contributions of a woman which admittedly had eased the domestic burden of the man who provided financial contributions.

  1. Trusts Essay on Fiduciary Duties

    When the Companies Act came in 1967 it placed no limit on how many solicitors could form a partnership which before the Act was restricted to twenty8, also with government's keenness to promote competition within the legal profession, it permitted advertising and allowed new providers of legal services to be established9 .

  2. Co ownership advice

    Upon death, their share is passed on to whomever the co owner chooses. This is more appropriate than joint tenancy for those who do not necessarily wish their fellow co owners to become entitled to their share.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work