This is an extract of our Trustee Powers And Will Drafting Pointers document, which we sell as part of our Private Client Notes collection written by the top tier of Cambridge And Oxilp And College Of Law students.
The following is a more accessble plain text extract of the PDF sample above, taken from our Private Client Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:
Private Client Powers for Trustees & Will Drafting Pointers When deciding whether to include these powers when writing a will...
Look to WILL DRAFTING points if asked to evaluate a will/ why would you make these changes?
? TRUSTS OF LAND AND APPOINTMENT OF TRUSTEES ACT 1996 [TLATA_
? TRUSTEE ACT 2000 [TA]
POWER Power to insureS.19 TA 1925 = very restrictive on what Personal Representatives [PRs] /
Trustees could insure against a) Insure only against loss or damage by fire; b) Insure up to 75% of the value of the property max; c) Had to pay premiums out of incomeTLATA 1996 = could also insure land [but still not other assets] for its full value
? S.34 TA 2000: substituted a new S.19. Wide powers to insure: o Against all property to its full value [however caused]. o Pay premiums out of trust funds [can use capital and / or income]
o Applies to ALL trusts whenever created.
Power to appropriate?
Statutory power is adequate without need for extension. Be aware that old wills [drafted before 2000] often include provisions to extend powers to insure.?
S.41 Administration of Estates Act 1925 PRs have power to appropriate any part of the estate towards satisfaction of a legacy - provided that no specific beneficiary is thereby prejudiced. [e.g. cannot appropriate a clock for Carol [beneficiary of PS1000) if Ben has already been left the clock in the will. Also a useful power if there is split residues. [2 people have entitlement]
S.41 imposes some restrictions which can be amended if appropriate:1. Must get consent of person to whom PR is making appropriation. AMMEND: remove need for consent. WHY: Administration is easier. What if beneficiary is a minor - consent would not be possible in this case
2. Must get valuation of the object at date of appropriation [not at date of death]. AMMEND: remove need for revaluation. Use the valuation at date of death instead. [unless asset has grossly changed in value since date of death]. So PR appropriates at probate value!
WHY: Avoid expense. Administration of estate is easier / simple.
Power to accept RECEIPTS from or on behalf of a minor
oNB. If asset is likely to change in value - then keep the statutory restriction. Receipt = discharge PRs from liability. Signed by the person entitled [i.e. beneficiary]. Provides evidence of legacy being paid [for purpose of any potential dispute]
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