STEP Provisions (2nd Ed) - secured loans

Trusts Discussion
1

Dear all

Please could I ask for any thoughts on the following:

Provision 4.1 of the STEP Provisions (2nd Ed.) says:

‘The Trustees may invest Trust Property in any manner
as if they were absolutely entitled to it. In particular the
Trustees may invest in land in any part of the world and
unsecured loans.’

Does this allow the Trustees make secured loans (including a loan/s secured against property)? I presume it does but I would welcome any thoughts from the Forum!

Thank you

Owen

2

Yes. The specific reference to “unsecured loans” is apparently due to the fact that historically there was some doubt as to whether such loans constituted "investments’ [Kessler “Drafting Trusts and Will Trusts”].

See also TA 2000 ss 3(3) and 8.

Malcolm Finney

3

Dear Malcolm

Thank you for the helpful clarification.

Thank you for taking the time to respond – I really appreciate it.

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