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Trustee Powers And Will Drafting Pointers Notes

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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?
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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