Delegation of operation of trust bank accounts

Trusts Discussion
1

A Will Trust includes the standard power of delegation from Butterworths Wills precedents, i.e.

“MY TRUSTEES may

1 delegate their powers of investment to or

2 allow any investments or other assets to be held in the name or names (as nominee or nominees on their behalf) of

any company or other person (whether or not being or including one or more of themselves) on any terms they think fit (and may exercise either power alone or both together)”

Do forum members believe this is sufficient to allow flexibility in the management of the trust bank account, for example, to allow any two trustees to sign, or even a non-trustee to be able to make withdrawals up to a fixed amount? I believe the clause is probably intended to allow this, but am not sure it would actually fall within a delegation of the trustees’ power of investment, or the holding of assets in a nominee’s name. And I note that some other precedents have express provisions for the operation of bank accounts, or much wider general powers of delegation of trustee functions.

If this power is not sufficient then the Trustees will have to look to the Trustee Act with all that entails in terms of written policy etc.

Diana Smart
Gordons LLP

2

If the trustees only intend to delegate the ministerial action of signing payment authorities, then I understand a simple resolution under s.11 Trustee Act 2000 confirming, say, that the banking mandate will authorise the bank to act on the instructions of any 2 trustees is sufficient. In that case, there is no need for any policy statement, etc.

As and when any payment out of the bank account is required, it is sufficient for those giving instructions to the bank (in whatever form), if required by any party, to be able to show that the trustees AS A BODY have authorised the transaction. This would include not just the payment of normal trustee liabilities but also distributions to beneficiaries consequent upon the exercise by the trustees of their discretion (which cannot be delegated under s.11).

Paul Saunders