Discretionary trusts – challenging and/or overturning decisions

Discretionary trusts remain one of the most widely used trust structures, offering flexibility, asset protection, control over the distribution of capital and income, and potential tax planning benefits. With recent changes announced in the Autumn Budget, their use is expected to increase further. However, these trusts are often misunderstood and can give rise to disputes and challenges for both trustees and beneficiaries.

This webinar will explore the most common areas of contention, provide practical guidance on drafting and administering discretionary trusts to minimise the risk of disputes, and equip practitioners with the knowledge needed to advise clients effectively and protect their interests when issues arise.

Topics covered include:

• Discretionary trusts: key terms and features
• Trustees: duties and responsibilities
• Trustee Decisions
  • Procedure
  • Relevant considerations
  • Momentous decisions: Public Trustee v Cooper [1999] All ER (D) 1524
• Challenging trustee decisions:
  • Challenging on technical grounds
    • Lack of consent
    • Breach of duty to act impartially
    • Failure to comply with formalities inn trust or by law
    • Excessive execution
    • Power exercised late or out of time
  • Challenges on substantive grounds:
    • Irrelevant considerations
    • Conflict of interest
    • Duress, undue influence, or misrepresentation
    • Acting in mistake or misapprehension
    • Fraud on the power
    • Breach of duty of care in exercise of investment powers
  • Procedural steps
    • Seeking an account
    • Seeking directions that trustees take or refrain from actions
    • Application for removal and appointment of trustees
    • Beddoes Orders
    • Unwinding and/or setting aside decisions: Hastings-Bass v Inland Revenue Commissioners [1975] Ch 25
    • Other considerations
• Claims against professional advisors
• Trustee costs and costs in litigation