One of the important changes in the Act, is the presumption that trustees must provide basic trust information to every beneficiary of the trust and further trust information if requested by a beneficiary. This article sets out what information the presumption applies to and the factors trustees may take into account in deciding whether or not the presumption applies. The Act records the purpose of the presumption is to ensure beneficiaries have sufficient information to enable the terms of the trust and the trustees duties to be enforced against the trustees. The presumption is that trustees must make available to every beneficiary, or a representative of a beneficiary, basic trust information as follows:
- the fact a person is a beneficiary of the Trust; and
- the name and contact details of the Trustee(s); and
- the occurrence of, and details of each appointment, removal and retirement of a trustee as it occurs; and
- the right of the beneficiary to request a copy of the terms of the trust or trust information.
A trustee is required to consider at reasonable intervals whether the trustee should be making the basic trust information available. If a beneficiary requests trust information, there is a presumption a trustee must within a reasonable period of time give the beneficiary or the beneficiary’s representative the information that person has requested. Trust information is any information regarding the terms of the trust, the administration of the trust, or the trust property and information that is reasonably necessary for the beneficiary to have to enable the trust to be enforced but does not include reasons for the trustee’s decisions. Trustees will need to decide whether they accept the presumption to make trust information available to beneficiaries when requested. Trustees will need to consider a range of factors, which are listed in section 53 of the Act, when deciding whether or not the beneficiaries should be given information about the trust. These factors are:
- the nature of the interests in the trust held by the beneficiary and the other beneficiaries of the trust, including the degree and extent of the beneficiary’s interest in the trust and the likelihood of the beneficiary receiving trust property in the future;
- whether the information is subject to personal or commercial confidentiality;
- the expectations and intentions of the settlor at the time of the creation of the trust (if known) as to whether the beneficiaries as a whole and the beneficiary in particular would be given information;
- the age and circumstances of the beneficiary and the other beneficiaries of the trust;
- the effect on the beneficiary, the trustees, other beneficiaries of the trust, and third parties of giving the information;
- in the case of a family trust, the effect of giving the information on relationships within the family and the relationship between the trustees and some or all of the beneficiaries to the detriment of the beneficiaries as a whole;
- in a trust that has a large number of beneficiaries or unascertainable beneficiaries, the practicality of giving information to all beneficiaries or all members of a class of beneficiaries;
- the practicality of imposing restrictions and other safeguards on the use of the information (for example, by way of an undertaking, or restricting who may inspect the documents);
- the practicality of giving some or all of the information to the beneficiary in redacted form;
- if a beneficiary has requested information, the nature and context of the request; and
- any other factor the trustee reasonably considers is relevant to determining whether the presumption applies.
The Act further provides in the event trustees decide to withhold all of the basic trust information from all beneficiaries or decide to refuse a beneficiary’s request to trust information, the trustees must apply to the court for directions in relation to whether the trustees’ determination is reasonable in the circumstances and the alternative means by which the trustees can be held accountable and the trust can be enforced. This is indicative of how important it is for the trustees to take the presumption to provide information to beneficiaries seriously.
Read more about the 2019 changes to the Trust Law Act here.
If you are a trustee of a trust and the above is of concern to you, contact one of our Trust team Wendy Dewes, Lesley Grant or Joanne Davies on 0800 GYW LAW.