Contents

Chapter 3
Trustees’ duties

Introduction

3.1The duties that a trustee owes to beneficiaries are a key facet of the trust relationship. Trustees’ duties are referred to very little in trusts legislation,84  but we considered that the scope of trusts legislation could usefully expand in this area. It is difficult to understand the trust without understanding trustees’ obligations.

3.2Different types of duties apply to the trust relationship. In this chapter we look at which duties are mandatory parts of every trust and which can be left out in a particular case. We also consider to what extent a trustee can avoid the consequences of a breach of trust. This is integrally related to the duties, as the effect of trustees being able to exclude liability for the breach of a duty may mean that the duty will have little real effect. This chapter also discusses the obligations on trustees to inform beneficiaries and to retain information.

84Sections 13B and 13C of the Trustee Act 1956 address the duty of prudence in relation to investments by trustees.