Trust Parties

Question 1

Role of the truster.

Answer 1

• creates express trusts
• inter vivos: natural or juristic person
• mortis causa: only natural person

Question 2

Instances where there is no truster.

Answer 2

• trust created by statute

- trust arising from operation of law

Question 3

What are the interests of a truster?

Answer 3

• right to appoint new trustees
• right to have property reconvened if private trust fails
• trust deed can include additional powers: obtain property back if trust fails

Question 4

Role of the trustee. Who can be a trustee?

Mckenzie v Watson and Stuart.

Answer 4

• legal owner of the trust (property in trust)
• trust cannot exist without trustees
• natural person with capacity
• juristic person
• public body

Mckenzie v Watson and Stuart.

• trustees own trust property
• trust property is immune from creditors of trustees

Question 5

Can trustees be renumerated?

Answer 5

Default position is that trustees will act gratuitously.

• can recieve remuneration for reasonable expenses
• e.g. professional trustee
• remunerated trustees cannot resign without authorisation

Question 6

How are trustees appointed?

Martin v Ferguson’s Trustees.

Answer 6

Originally by indication in trust deed from the truster.

Martin v Ferguson’s Trustees:
- appointed not only by name but descriptive reference

Question 7

What is an ex officio trustee?

Answer 7

Parish Council of Kilmarnock

- trustee carrying/holding a particular office

Question 8

Appointment of new trustees.

Answer 8

Lord Glentanar v Scottish Industrial
- truster may appoint new trustees in a lapsed private trust even if deed is silent

• truster may reserve right in deed
• may nominate person with appointment power

Question 9

Effect of death of trustee.

Answer 9

• trust does not come to an end
• death divests trustees of the title
• title passes to other trustees

Question 10

Kerr v City of Glasgow Bank

Answer 10

• appointed trustee must accept office
• expressly or impliedly from actings
• e.g. signing dividend was deemed to be accepting trust office

Question 11

How can new trustees be nominated?

Answer 11

• Quorum: T(S)A 1921, s3(b), unless excluded by trust deed
• Deed of assumption: s21
• Court:
  s22, CoS
  s34, nobile officium

Question 12

Can trustees resign?

Answer 12

T(S)A 1921, s3(a)

• yes, unless prohibited by trust deed
• only if new trustees assumed and declared acceptance of office
• sole trustee cannot resign
• remunerated trustee cannot resign without authorisation
• inaction if insufficient means of resignation Ker v CGB

Question 13

Process of resignation by trustee.

Answer 13

s19
- minute of resignation

sch A
- intimation to other trustees

Question 14

When do trustees personal liabilities end?

Answer 14

• not at resignation but at discharge

Question 15

Can trustees be removed?

Answer 15

• incapacity
• disappear for more than 6 months

T(S)A 1921 s23

• CoS or sheriff court can remove a trustee for reasons above
• nobile officium

Question 16

Role of beneficiary.

Answer 16

Person/s (natural or juristic) whom trustees hold trust property for and owe fiduciary duties to.

Question 17

Effect of no beneficiaries?

Answer 17

Trust becomes revocable.

Question 18

Inland Revenue v Clark’s Trustees.

Answer 18

Beneficiaries can compel trustee to:

• carry out trust property
• make good any loss they are liable for

Question 19

Right of a beneficiary.

Answer 19

Personal right in private trusts against the trustee.
Do not have a real right.
Assignable right in private patrimony