First Investment - Hybrid Trust or personal

[Terry_w]

Unfortunately they make all of these things ridiculously complex and technical, creating whole industries that shouldn't be required.

Things just evolve this way. There is no 'they' who sit down and say lets make trusts more complex. In fact the opposite, the government is conducting a review of trusts in an attempt to make things more straight forward (but this will probably only make things more complex).

But the same can be said about personal ownership of property. There is probably more caselaw in this regard. Bankruptcy, priorities, family law, succession law - family provision and notional estate orders, taxation etc. Its all very complex.

 

[mattnz]

Couldn't agree with you more Terry.

 

[Terry_w]

Good on you Matt!

Going through my notes, another mistake that was reported:

X set up a trust deed online with the beneficiaries defined as the spouse/children/parents etc of the appointor. All good, but the role of the appointor was left blank. This was only discovered many years later when the trust held about $20mil worth of assets. An expensive application was needed to the Supreme Court to rectify the obvious mistake.

 

[Terry_w]

Another provided that on the trustee's death the trust converted to a fixed trust with only one beneficiary - that of the deceased - another application to the Supreme Court to fix.

Another one involving a billionaire whose trust was set up by top tier law firm. On vesting (winding up of the trust) there was no obligation on the trustee to distribute income and assets of the trust to anyone. This meant the trust was void ab inito - from the beginning for lack of certainty of object. This would have resulted in a resulting trust in favour of the settlor - who was the personal assistant of the lawyer who set it up. Assets of the trust were $1billion plus. An application was needed to be made to the Supreme Court and cooperation by the settlor was needed.