If a trustee is not protected by an exemption clause, he/she could escape liability if the claim is time-barred. An exemption clause cannot excuse a trustee who either knows that his act or omission is contrary to the beneficiaries' interests or is recklessly indifferent to the beneficiaries' interests. However, even if there is an exemption clause, trustees still have a minimum duty to perform the trusts honestly and in good faith for the benefit of the beneficiaries. Breaches the common law or statutory duty of care, for example by exercising a power of investment without exercising such skill and care as is reasonable in the circumstances.Ī trustee who has committed a breach of trust could be protected from a breach of trust claim by an exemption clause in the trust deed.Breaches a fiduciary duty such as the duty not to profit from the trust.Invests the trust fund in a way not permitted by his express or statutory powers of investment.Distributes trust assets to a beneficiary who is not entitled to them under the terms of the trust document.
Trustees are jointly and severally liable for breach of trust to their beneficiaries where that breach has led to a loss to the trust fund.Ĭommon allegations of breach of trust include where a trustee:
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