– what this will mean to you as a Trustee
It’s quite surprising to learn that there are an estimated 300,000 to 500,000 Trusts in New Zealand. For the first time in more than 60 years a bill has been introduced to Parliament which signals significant changes to trust law.
The Bill is intended to clarify and simplify core trust principles, provide better guidance for Trustees and beneficiaries and make it easier to resolve disputes, but also sends a clear message about the need for improved record-keeping and compliance especially for non-professional trustees.
Key requirements for Trustees are:-
(Clause 22) A duty to know terms of the Trust.
(Clause 41) Each Trustee must keep copies of:-
- The Trust Deed and any variations.
- Records of the Trust property that identify the assets, liabilities, income and expenses of the Trust and that are appropriate to the value and complexity of the Trust property.
- Any records of Trustee decisions.
- Any written contracts.
- Any accounting records and financial statements.
- Details of appointment, removal and discharge of trustees.
- Any letter of Memorandum of Wishes.
- Documents kept by former trustees.
(Clause 43) Trustees must keep, as far as is reasonable, the documents for the duration of the trustee’s trusteeship.
(Clause 44) Trustees must pass on these documents if the trusteeship of a trustee ends, if the Trust continues.
(Clause 37) The terms of a Trust must not limit or exclude a trustee’s liability for any breach of trust arising from the trustee’s dishonesty willful misconduct, or gross negligence.
(Clause 38) The terms of a Trust must not give a trustee indemnity against the Trust property for liability for any breach of trust arising from the trustee’s dishonesty willful misconduct, or gross negligence.
(Clause 46) Requirement for Trustees to disclose (as appropriate) information to beneficiaries to enable the terms of the trust and the trustees’ duties to be enforced against the trustees.
Click the link to the Trust Bill for more information:-