The reality is that the appointer is the person with all the power. Even though they can't make decisions on who gets the money, they are seen as the 'controller' because they can put somebody else in as the trustee if they want. So don't be flippant when putting in a new appointer.
I believe for government pensions, that they will be affected if the person receiving the pension is an appointer to a trust, because of this effective control.
You've mentioned bankruptcy as a factor. This is the same thing as being sued. If somebody sues you then they get a ruling for more than you have, thus when you dont (can't) pay, they can bankrupt you and try to get to your assets. This is why your asset protection strategy must distance you from your assets in the event of bankruptcy.
I've been told by a number of people that in the event of bankruptcy there is no problem if you're set up correctly. If your assets are being liquidated, your role of appointer cannot be added to your estate, so no liquidator can take that role on. If they could, they would be able to become the appointer, appoint their own trustee and do what they want with your assets. This is fair enough, because if a trust has assets purely for the beneficiaries, then they would be affected unfairly as their asset would be taken from them even though they were not the ones being liquidated.
The people who have given me this information are:
Commercial solicitor (quoting Wiley's case)
Chris Batten (from his website)
Ed Burton
Another accountant
However, keep an eye on ruling like this to make sure this doesnt change. I saw one a while ago where it almost got up (it was only 2 judges for and 3 judges against). And, of course, continue to seek your own legal advice.
Tubs
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