Running a trust - Fiduciary duties

Question 1

Breaches of fiduciary duties - The trustees as a purchaser (self-dealing) - Situations

Answer 1

1) The trustee purchases trust property for himself and his co-trustees
2) The trustee purchases the equitable interest of a beneficiary

Question 2

Breaches of fiduciary duties - Competition with the trust

Answer 2

Where the trust includes a business and a trustee sets up his own business in competition the trustee is accountable for any profits made out of the competing business

Question 3

Breaches of fiduciary duties - Unauthorised remuneration of trustees - Basic rule

Answer 3

Trustees cannot demand payment for their services unless authorised.

Question 4

Breaches of fiduciary duties - Unauthorised remuneration of trustees - Authorisation

Answer 4

1) Charging clause in the trust instrument
2) Beneficiaries’ consent
3) Court order
4) Trustee act - professional trustees

Question 5

Breaches of fiduciary duties - Incidental profits

Answer 5

Trustees must account to the trust for any personal profit they gain from the use of trust property or from exploiting information or an opportunity that arose by virtue of the trusteeship