Attorneys under LPA and Trusts - Capacity to set up and gift

Trusts Discussion
1

Hi - some thoughts on the following would be most welcome please:

Clients A & B set up a bare trust document for C in their capacity as C’s attorneys.

C is in a care home and her property is going through the sale process. Clients are concerned that C may die before the sale completes and set the trust up to transfer the property in to it to be held for C’s benefit.

The issue is the trust being set up by attorneys of C, although there is plenty of guidance saying attorneys should seek an order from the court of protection, there appears to be no statutory provision?

Would it also be the case that this is not classed as a gift from C as the transfer was of no value and the beneficial interest is not moving across, and there are no tax implications, for C or the trust?

many thanks

2

Whilst the position vis-à-vis C is potentially unchanged, the effect of setting up the trust will likely be to take the property outside of the jurisdiction of the Court of Protection. It would therefore seem to me that the Court’s approval must be obtained before this may validly be achieved.

Paul Saunders FCIB TEP

Independent Trust Consultant

Providing support and advice to fellow professionals

3

Thank you for your thoughts Paul - much appreciated.