Trustees' powers & duties
Trustees hold and administer the trust property subject to statutory and equitable duties and powers. The Trustee Act 2000 modernised much of this framework.
What "Trustees' powers & duties" covers
- Core fiduciary duties: act in the best interests of the beneficiaries, avoid conflicts of interest, and not profit from the trust without authority (Bristol & West BS v Mothew).
- The statutory duty of care (Trustee Act 2000 s.1) requires such care and skill as is reasonable in the circumstances, higher for professional trustees.
- General power of investment (Trustee Act 2000 s.3) allows any kind of investment as if absolutely entitled, subject to standard investment criteria (s.4) and the duty to take advice (s.5).
- Trustees must act unanimously (unless the trust provides otherwise), act personally, but may delegate certain functions collectively under Trustee Act 2000 Part IV to agents, nominees and custodians.
- Duty to act impartially between beneficiaries (income vs capital) and to keep accounts and provide information; disclosure of trust documents is discretionary (Schmidt v Rosewood).
- Powers of maintenance (Trustee Act 1925 s.31) and advancement (s.32, now up to the whole of a beneficiary's presumptive share) support minor and adult beneficiaries.
- Trustees may be paid only if authorised by the trust, statute (Trustee Act 2000 ss.28–29 for professional/trust-corporation trustees), the beneficiaries, or the court.
Key cases & statutes
The authorities and provisions most likely to matter for this subtopic:
How it's tested in SQE1
SQE1 uses single best answer questions: a short factual scenario, one precise question, and five options of which only one is the best answer on the law applied to the facts. For trustees' powers & duties, expect to be asked what the correct legal position is, what a party may or must do, or which outcome follows — with more than one option looking arguable. Reading the facts carefully and eliminating the near-misses is the skill that earns the mark.
Where candidates lose marks
- Applying the same standard of care to lay and professional trustees — s.1 sets a higher bar for professionals.
- Assuming trustees may always charge for their services; remuneration needs authority.
- Overlooking the standard investment criteria and the duty to obtain and review advice under the Trustee Act 2000.
Learn this subtopic in the course
A video lesson, notes and exam-style practice on trustees' powers & duties.
FAQ
Is trustees' powers & duties tested on SQE1?
Yes — trustees' powers & duties is part of the SQE1 Trusts syllabus (FLK2) and can appear in single best answer questions.
How is trustees' powers & duties examined in SQE1?
SQE1 tests it by application: you're given a realistic scenario and choose the single best answer from five options. The focus is on using the law correctly, not reciting it — knowing the leading authorities (Trustee Act 2000 s.1, Trustee Act 2000 s.3-5) helps.