Trust 11 - Trustee powers & Duties Advancement Flashcards

1
Q

What is the duty to distribute?

A

must pay as soon as possible

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2
Q

Who can trustees pay income to early

A
  • Minors
  • no prior interest
  • Not adults (have duty to pay income to suits anyway)

Cannot be made where there is a prior interest (so where there is a life tenant with the child reminder, the trustees can’t pay maintenance out of income for the child because it belongs to the life tenant)

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3
Q

Who can trustees pay capital to early

A
  • Minors
  • Adults

Can be made if there is a prior interest, but the trustees will need that person’s written consent

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4
Q

Where there is a contingent subsequent interest (i.e. trust holds for A until 21 and if not for B), do the trustees need permission from B before making the payment?

A

No, B has a subsequent interest. Consent is only required for a prior interest.

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5
Q

If requested, do trustees HAVE to make an advancement?

A

No. They MAY make an advancement.

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6
Q

What is the power of maintenance s.31 Minor

A

Power to pay income
- Where a minor has a vested (or contingent) interest in trust, trustees can pay income as they think fit
- Must be used for primary benefit of minor
- does not apply if someone else has prior rights to income (successive interest trust)

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7
Q

What is the power of advancement s.32 anyone

A

Power to pay capital
- A B who expects to receive capital from trust in future may wish to receive capital before it vests in possession
- adult and minor B,
- vested or contingent interests
- pay up to 100%
- pay out where prior interest if of age, not mental.
- immediate financial benefit, ensuring money is used for purposes it was provided for

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8
Q

How much advancement can be made?

A

100% of capital

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9
Q

Do trustees need to check what the B is actually spending the money on?

A

Yes, or else breach of duty

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10
Q

Do adult beneficiaries have the right to income as it arises?

A

Usually yes

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11
Q

Should the trustees make payment directly to the minor?

A

No, they cannot give good receipt

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12
Q

Does the ability to pay maintenance to a child out of income apply to accumulated income?

A

Yes

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13
Q

How much advancement can be made if trust set up before 1 October 2014

A

50%

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