The rights of a trustee - Free Essay Example

Sample details Pages: 8 Words: 2502 Downloads: 1 Date added: 2017/06/26 Category Law Essay Did you like this example? Upon a trustee accepting their role, they are bound by certain duties to the trust and its beneficiaries, which they must exercise with due regard when discharging their trustee power. These are predominantly governed by the Trustee Act 1925, as amended, however there have also been many occasions where the courts have sought to elaborate upon these duties in such a way that widens or restricts the scope of their application, and thus also affects the possible rights of beneficiaries to certain privileges under the trust. This brief will seek to explore the ways that the courts have imposed certain duties and restrictions on trustees, particularly in relation to the disclosure of information. Don’t waste time! Our writers will create an original "The rights of a trustee" essay for you Create order In order to analyse such an issue, it is important to firstly have an understanding of the general fiduciary duties, and other general law duties, of trustees upon their appointment to their position. As such, a number of legislative and common law provisions will be discussed. Perhaps the most important point to be made about the duties of trustees is that it is generally defined by the text of the trust instruments, and the general law simply provides a background that allows a settlor to set the boundaries of these duties. This is best evidenced in the case of Target Holdings Ltd v Redferns (a firm), where Lord Browne-Wilkinson said: à ¢Ã¢â€š ¬Ã‚ ¦the basic right of a beneficiary is to have the trust duly administered in accordance with the provisions of the trust instrument, if any, and the general law.[1] This means that a breach of duty can only occur if there was a specific duty outlined in the documents that established the trust, or are in breach of general law pro visions, and any absence of such a specification means that a trustee has effectively acted in accordance with their duties under the trust. It is also important to note that a testator can also modify or exclude any of the general law duties applicable to trustees by specifying as such in the trust instruments. This may be an unusual situation, however the common law provides for such a scenario to arise. This is best demonstrated by the case of Hayim v Citibank, where Lord Templeman stated: It is of course unusual for a testator to relieve the trustee of his will of any responsibility or duty in respect of the trust property, but a testator may do as he pleases.[2] Essentially then, while the general law imposes certain duties on a trustee, the testator is free to modify and amend these duties as he or she sees fit, thus limiting the scope of application of the general law in relation to trusteesà ¢Ã¢â€š ¬Ã¢â€ž ¢ duties. HayimHIn light of the issue at hand, this could be co nstrued as there not being a duty upon the trustees to minute their trustee meetings, unless there is a specific provision that requires them to do so in the trust instruments. The general law in relation to the disclosure of information to beneficiaries will be discussed in more detail shortly, however the general rule in relation to this would suggest that there is no specific requirement for trustees to document their decisions in the minutes of a trustee meeting. However, if they still choose to do so, they may be subject to the rules of disclosure of information to the beneficiaries upon request, which will be discussed in further detail shortly. In regards to the management decisions that a trustee is allowed to make, there are a number of statutory provisions that indicate to this extent. These include the power to raise money by sale or mortgage of the trust property (but does not apply to the trustees of a charity, which raises separate issues not necessarily within the sco pe of this brief),[3] the power to give receipts,[4] the power to insure the trust property and pay those premiums out of the trust funds,[5] and the power to compound any liabilities of the testator by taking action that they think fit to resolve the situation.[6] As one can see, the trustees of a trust are given substantial powers to exercise on behalf of the testator (or settlor, as the case may be). As such, there also needs to be recognised limits to this power, which this brief will now discuss. Common law does not recognise the fact that a trustee owes a duty of care to the beneficiaries (and the testator or settlor) when exercising their role, however equity does. Under equity, a trustee is à ¢Ã¢â€š ¬Ã…“merelyà ¢Ã¢â€š ¬Ã‚  required à ¢Ã¢â€š ¬Ã…“to conduct the business of the trust in the same manner that an ordinary prudent man of business would conduct his ownà ¢Ã¢â€š ¬Ã‚ .[7] This has since been codified in legislation, giving it a more direct and relevant eff ect.[8] The Trustee Act 2000 gives the duty of care the scope of application to apply to trusteesà ¢Ã¢â€š ¬Ã¢â€ž ¢ decisions relating to investment, acquisition of land, insurance, and also in instances where that managerial power has been delegated to others.[9] Limits to the application of this duty are also recognised, such as that in Re Godfrey, where Bacon V-C said: No doubt it is the duty of the trustee, in administering the trusts of a will, to deal with property intrusted into his care exactly as any prudent man would deal with his own property. But the words in which the rule is expressed must not be strained beyond their meaning. Prudent businessmen in their dealings incur risk. That may and must happen in almost all human affairs.[10] In other words, while the trustee is required to exercise a reasonable standard of care, they cannot be held accountable for any loss incurred where the risk of such a transaction was deemed to be coincidental to the ordinary course o f business. In addition to the duty of care, a trustee is required to also act in the interests of fairness to the beneficiaries of the trust, respecting the fact that the beneficiaries obviously need to benefit as a result of the trust. The most authoritative case on this duty is that of Nestle v National Westminster Bank plc, where Hoffman J said: This brings me to the second principle on which there was general agreement, namely that the trustee must act fairly in making investment decisions which may have different consequences for different classes of beneficiaries.[11] This means that a trustee must not only consider the interests of the beneficiaries as a whole when making management decisions, but must consider the fairness of the effects of these decisions with regard to all the different classes of beneficiaries under the trust. These are perhaps the two most relevant duties that a trustee must have regard for, beyond their other fiduciary duties imposed upon commenc ement of their appointment as a trustee. These fiduciary duties include not to sell trust property to him or herself (the self-dealing rule) and to make the purchase of such property fair (the fair-dealing rule),[12] a duty to not place themselves in a position of conflict,[13] and a rule against unauthorised profit.[14] These are just a few examples of the duties that trustees owe to the beneficiaries, and to the trust as a whole. As one will note, there seems to be no duty that has arisen under general law principles that provides for a requirement for minutes of trustee meetings to be kept. Rather, this is left either to the text of the trust instruments or, where such a specification is absent, the discretion of the trustees. The court recognises that trustees have a à ¢Ã¢â€š ¬Ã…“wide discretionà ¢Ã¢â€š ¬Ã‚  when exercising the role of their office,[15] however it is clear that these powers are quite restricted, but not to the extent where the rationale behind the decisions is required to be documented and presented to the beneficiaries upon request. The idea of a beneficiaryà ¢Ã¢â€š ¬Ã¢â€ž ¢s right to information has been significantly expanded upon by the courts in recent times. Previously, the courts have adopted the view that access to information by the beneficiaries is a proprietary right of being a beneficiary, and that they should have access to all trust documents upon request. This is best displayed in the case of Oà ¢Ã¢â€š ¬Ã¢â€ž ¢Rourke v Darbishire, where Lord Wrenbury said: The beneficiary is entitled to see all trust documents because they are trust documents and because he is a beneficiary. They are in this sense his own.[16] This presented a key issue. It assumes that all information relating to the management of the trust is able to be accessed on a proprietary basis, thus often denying the trustees the confidentiality and, in effect, trust to exercise their role fully without external and extraneous influence. This propri etary right was later objected to in the case of Re Londonderryà ¢Ã¢â€š ¬Ã¢â€ž ¢s Settlement,[17] where it was held that trustees who exercise a discretionary power are not bound to disclose the reasons for their decision to other parties, but can choose to do so if they wish. Interpreting such conflicting case law is tough. It presents two opposite points of view in relation to the duty of a trustee (or trustees) to disclose information to beneficiaries, making it difficult to establish whether such a duty exists. The most significant progress made on expanding this duty in recent times would be that made in the case of Schmitt v Rosewood Trust Ltd, where it was held that while the previous case law was not easy to reconcile, the overriding concern was to protect the confidentiality of information relating to managerial decision made by the trustees, thus granting them the privacy and security they require to exercise their dispositive discretions, and that such a right would over ride any proprietary right that a beneficiary may have to that information.[18] This case is technically not binding in England as it relates to a trust formed in the Isle of Man; however it is assumed it will be followed, given it has been followed in a number of other jurisdictions already.[19] In Australia, it has been established that the court must find a balance between disclosure of the information and the need to protect confidentiality in the interests of promoting a safe environment for managerial decision-making.[20] In short, it would appear that the courts are moving more towards the adoption of protection in favour of the trustees, more so than allowing the information to be discovered by the beneficiaries. While there is no clear duty in general law requiring trustees to either record or disclose reasons for their decisions in any event, there is also suitable protection ensuring that, even if such reasons are recorded, they are not subject to easy disclosure to the b eneficiaries, due to the often sensitive nature of such business material. In conclusion, this brief has considered many aspects of a trusteeà ¢Ã¢â€š ¬Ã¢â€ž ¢s duty to the beneficiaries and the trust. It discovered that most trusteesà ¢Ã¢â€š ¬Ã¢â€ž ¢ duties arise as a result of their inclusion in the documents that form the trust, and are merely expanded upon by the general law. As such, there is no clear requirement that requires trustees to document and record their decisions (and reasons for those decisions) in the minutes of the meeting, unless there is a specification as to such a procedure in the trust instruments. The general law remains silent on this issue, thus emphasis needs to turn toward the trust instruments themselves, given that it has been established that the testator or settlor is able to modify or exclude general law duties if he or she (or they) specify as such in the trust instruments. In any event, it has also been established that decisions made by the t rustees in relation to the management of the trust are afforded considerable confidentiality under the general law, which can often override any proprietary right which a beneficiary may have to the information. It has been established that the board of trustees is not required to disclose its reasons for making a decision, and also that the court will generally be required to make a consideration which balances the need for the information to be released in conjunction with the need for it to be protected in the interests of promoting a safe decision-making environment. The law seems to fall in favour of the trustees, imposing a burden on the beneficiaries to petition the court with just cause as to have the information released, however it seems in all likelihood that a court will often serve to protect the information relating to managerial and administrative aspects of the trust, as it is the trustees that are empowered to make these decisions and, given that the discretion they possess is considerably wide, there is a need for them to exercise this discretion in an environment that would promote safety and the integrity of the decision-making process. Bibliography Books Pettit, P, Equity and the Law of Trusts (2006, 10th ed), London: Oxford University Press Watt, G, Todd and Wattà ¢Ã¢â€š ¬Ã¢â€ž ¢s Cases and Materials on Equity and Trusts (2005, 5th ed), London: Oxford University Press Legislation Trustee Act 1925 Trustee Act 2000 Cases Boardman v Phipps [1967] 2 AC 46, HL Broere v Mourant Co [2004] JCA 009, [2004] WTLR 1417 Foreman v Kingstone [2004] 1 NZLR 841 Fry v Fry (1859) 28 LJ Ch 591 Hartigan Nominees Pty Ltd v Rydge (1992) 29 NSWLR 403 Hayim v Citibank [1987] AC 730, PC Nestle v National Westminster Bank plc (1996) 10(4) TLI 11, CD Re Godfrey (1883) 23 ChD 483 Re Londonderryà ¢Ã¢â€š ¬Ã¢â€ž ¢s Settlement [1963] Ch 918, [1964] 3 All ER 855, CA Re the Intermine and the Intertraders Trusts [2004] JLR 325 Re Thompsonà ¢Ã¢â€š ¬Ã¢â€ž ¢s Settlement [1986] 1 CH 99, CD Schmitt v Rosewood Trust Ltd [2003] UKPC 26, [2003] 3 All ER 76 Sergeant and another v National Westminster Bank plc (1990) 61 P CR 518, CA Speight v Gaunt (1883) 9 App Cas 1, HL Target Holdings Ltd v Redferns (a firm) [1996] 1 AC 421, HL Tito v Waddell (No 2) [1977] Ch 106, CD 1 Footnotes [1] Target Holdings Ltd v Redferns (a firm) [1996] 1 AC 421, 434A, HL (Lord Browne-Jackson). [2] Hayim v Citibank [1987] AC 730, PC (Lord Templeman). [3] Trustee Act 1925, s 16. Also note the fact that a trustee is also compelled to obtain the best price for the sale of the property, which may result in them having to renege on an already existing offer. For an example of this, see Fry v Fry (1859) 28 LJ Ch 591. [4] Trustee Act 1925 as amended, s 14. [5] Trustee Act 1925, s 19. This section is presented as amended by the Trustee Act 2000. [6] Trustee Act 1925, s 15. This section is also as amended by the Trustee Act 2000. [7] Speight v Gaunt (1883) 9 App Cas 1, HL. [8] See Trustee Act 2000, s 1 and sch 1. [9] Trustee Act 2000, sch 1. [10] Re Godfrey (1883) 23 ChD 483, 493 (Bacon V-C). [11] Nestle v National Westminster Bank plc (1996) 10(4) TLI 11, CD (Hoffman J). [12] Tito v Waddell (No 2) [1977] Ch 106, CD; Re Thompsonà ¢Ã¢â€š ¬Ã¢â€ž ¢s Settlemen t [1986] 1 CH 99, CD. [13] Sergeant and another v National Westminster Bank plc (1990) 61 P CR 518, CA. [14] Boardman v Phipps [1967] 2 AC 46, HL. [15] Nestle v National Westminster Bank plc (1996) 10(4) TLI 11, CD (Hoffman J). [16] Oà ¢Ã¢â€š ¬Ã¢â€ž ¢Rourke v Darbishire [1920] AC 581, 626-7, HL. [17] [1963] Ch 918, [1964] 3 All ER 855, CA. [18] Schmitt v Rosewood Trust Ltd [2003] UKPC 26, [2003] 3 All ER 76. [19] For example, this case has been adopted in New Zealand in Foreman v Kingstone [2004] 1 NZLR 841. See also Broere v Mourant Co [2004] JCA 009, [2004] WTLR 1417 and Re the Intermine and the Intertraders Trusts [2004] JLR 325 in Jersey. [20] Hartigan Nominees Pty Ltd v Rydge (1992) 29 NSWLR 403.

United States And Philippines The Melting Pot Of...

In our country today, we are a nation of diverse cultures. America is considered the melting pot of different ethnic groups. By today’s standard, â€Å"American Culture† is the result of a variety of races integrating their own cultural beliefs into American society. Throughout the years the US has seen a massive increase of people migrating from Asian countries. Like other immigrants, Asians come here in order to seek a better life and experience civil liberties and I include myself to that. Immigrating from the Philippines and going to the United States forced me to grow up and learn to adapt its culture. I have learned to embrace American culture along with my Filipino culture. Over the past 8 years of living in America, I have learned to adapt its environment. Coming here as an eleven year old, I noticed similarities and differences between United States and Philippines. Most Filipinos tend to not be as assertive as Americans when it comes to speaking their mind. 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Empress Wu’s rise to power is interesting Free Essays

There is A Confucian dogma that pushes women ruling as â€Å"unnatural† (Empress Wu Zetian, 2008).   However, in China there lived one woman who rose to power. Wu Hou, also called Empress Wu Zetian, ruled China during the Tang dynasty, the only female to do so (2008). We will write a custom essay sample on Empress Wu’s rise to power is interesting or any similar topic only for you Order Now While some depict Empress Wu’s regime as autocracy, it could not be denied that she ruled China effectively, preserving the country’s diplomatic relationships with other nations (Hucker, 1975, p.143). Empress Wu’s rise to power is interesting. The Tang dynasty is described as a time when women experienced some freedom, at a time when women were not limited to being subservient (Empress Wu Zetian, 2008). It was a period where women became part of cultural and political endeavors (2008).   Wu came from a noble family and thus was taught music, how to write and read Chinese classics (2008).   Her father was one of Emperor Kao- tsu’s supporters while her mother descended from the Sui royal family (Safra, 2002, p.90). When she was 13 years old, she was sent to Emperor Tai Tsung’s court to be a servant (2008). Soon, Wu became Emperor Tai Tsung’s favorite concubine. When the emperor died, Wu was removed from the palace, as customary (Hucker, 1975,b p.142). The emperor’s son, Kau-Tsung became the emperor at age 21 (2002). However, the new emperor, as fate would have it, was also enamored with Wu, giving him sons (Empress Wu Zetian, 2008). Wu soon became the emperor’s favorite concubine and soon was hungry for power. Rumors have it that that Wu killed her own child and blamed Empress Wang (Kau- Tsung’s wife) of the crime (Walsh, 2003).   Kau-Tsung believed Wu and married her, making her the new empress (2008). Five years into their marriage, the emperor was struck with stroke and soon gave power to Empress Wu. When Emperor Kau-Tsung died, Empress Wu used her power to renounce the new emperors, her sons and by 690, Empress Wu was crowned as the Emperor of China (Walsh, 2003). She ruled China until 705 (Hucker, 1975, p.142). Empress Wu soon began her campaign to uplift the women in a relatively men-dominated environment. She ordered scholars to write biographies of prominent women (Empress Wu Zetian, 2008). She also saw to it that her mother’s clan was given high positions in the political arena (2008). The new empress favored religion and symbolism. Rituals were changed during her reign (Safra, 2002, p.90).   Names of officials were even altered, and the emperor or empress, in her case, was dubbed with the new title â€Å"Heavenly Emperor† (p.90).   Empress Wu manipulated the government to follow her, employing informers and agents (p. 90). She made Buddhism as the preferred state religion (Empress Wu Zetian, 2008). Empress Wu was able to engineer the Buddhist scripture into building a Ming T’ang or â€Å"Hall of Light†, a shrine to Heaven as depicted in the Classics (p. 90). She was even able to convince every prefecture to create a temple which alludes to Wu being an incarnation of Buddha (p.90). The empress’ given surname ‘Wu’ was also exploited. Everyone who had the same surname as the empress was exempted from paying taxes (p.90). In 690, Empress Wu changed the dynasty from T’ang to Chou (Safra, 2002,p. 90). She had become China’s female ruler. During Empress Wu’s reign, China was in the midst of foreign battles.   Despite being depicted as a dictator, Empress Wu was instrumental in China’s diplomatic relationships. Together with Kao-Tsung, Wu mediated in the Korean Civil War (Hucker, 1975,p.143). At that time, Koreans were able to dominate in the Korean state of Silla, they acknowledged Wu’s reign (p.143). When Empress Wu was 80 years old, her power had started to diminish. She was finally abdicated and the T’ang dynasty was restored (Safra, 2002,p. 91). Empress Wu is truly an interesting leader. For one, she is female. At a time when males where dominating the political arena, she rose to power. It is remarkable especially since Asian culture tends to be patriarchal and for a female to rule and succeed, that is exceptional. True, Empress Wu’s reign was plagued with intrigues and scandals.   She was a dictator, a usurper and while this is not new to some leaders, it is still rather surprising to find a woman who is such. That is not to say that only men can be dictators. Women can also be dictators but sometimes they simply do it subtly. Empress Wu was shrewd and she let the world knew it.   It is even shocking to discover that she may have murdered her own child just to fulfil her desire to become empress. Although this was never confirmed, the thought of parent harming his/her child is disturbing. It is something that people read in newspapers or see in the television now but to think that it happened way before it has become a norm, to say the least, it truly startling. Stories of leaders conning people to get what they want is normal, albeit wrong. This just goes to show that even during those times; power and greed were already present and destroying individuals. On a positive note, Empress Wu was one who paved the way for women empowerment. She used her position to uplift the status of women in her country.   It is interesting to know during a time when women were thought to be subservient; there rose a woman who wanted to change the norm. Leaders, regardless of gender, can learn something from Empress Wu- good traits and bad ones. References Empress Wu Zetian (2008). Retrieved 17 February 2008 Hucker, C. (1975). China’s Imperial Past. An Introduction to Chinese History And Culture. California: Stanford University Press. Safra, J. (Ed.). (2002). China. The New Encyclopedia Britannica, Vol.16, pp.90-91. Walsh, J. (2002). The Empress Wu Hou- China’s Only Female Ruler, Retrieved 17 February 2008, from http://www.suite101.com    How to cite Empress Wu’s rise to power is interesting, Essay examples