6. Appointment, Retirement, and Removal of Trustees Flashcards

1
Q

What is the minimum number of trustees?

A

One, but if trust property is land at least two trustees or a trust corporation is required to give valid receipt for capital money arising on the sale of land

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2
Q

What is the maximum number of trustees for (1) a trust of land and (2) a trust of all other property?

A

Land: Maximum of four
Other property: No maximum

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3
Q

Once the trust is created, does the settlor retain power to appoint new trustees?

A

Not unless there is express provision in the trust instrument

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4
Q

What therefore applies in the absence of express provision [for appointment of trustees] in the trust instrument?

A

Statutory rules on appointment, retirement, or removal of trustees

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5
Q

Who has the power to appoint additional trustees?

A

All trustees, unless one is designated to have this power

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6
Q

Even where the trust is not land, what is the number of trustees which a trust must not exceed specifically through the trustees’ statutory power to appoint new trustees?

A

Four.

If a trust already has four trustees, this power will therefore not be available.

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7
Q

What four parties have the statutory power to appoint replacement trustees, and in what order of priority?

A
  1. Person named in the trust instrument, or if silent:
  2. Surviving/continuing trustees, or if none:
  3. Personal representative of the last surviving trustee, or if none
  4. The court
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8
Q

Must whatever party is appointing the replacement trustee replace all outgoing trustees?

A

No, but they can if they want

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9
Q

Other than where they are dead, what is the exception to the rule that a retiring trustee should be a party to an appointment by trustees?

A

Where the trustee has been removed against their will

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10
Q

Must the appointment of a replacement be in writing?

A

Yes, but it does not have to be made by deed

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11
Q

Even though a deed is not necessary, why is it usually used?

A

Because it will vest legal title to the trust property in the new trustee

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12
Q

Although beneficiaries generally have no power to control the trustees unless there has been a breach, they can select trustees if what three conditions are met?

A
  1. No person is nominated in the trust instrument to have this power
  2. The criteria of the rule in Saunders v Vautier are met (sound age and mind, together they are absolutely entitled), and
  3. Beneficiaries act unanimously
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13
Q

Where these criteria are satisfied, what can the beneficiaries do, and why when the general rule is that they cannot?

A

In writing, order one or more of the existing trustees to retire and order the remaining trustees to appoint a trustee/trustees of the beneficiaries’ choosing.

They can do this because the rule in Saunders v Vautier is satisfied, so they could elect to shut down the trust and take the property anyway if they wanted.

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14
Q

What is the effect of one beneficiary’s interest being contingent when removing trustees?

A

Then all beneficiaries are not absolutely entitled to the trust property, and as such neither the rule in Saunders v Vautier nor the extension allowing them to remove a trustee applies

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