Editing Trustee (section)

==General duties of trustees==<!-- This section is linked from [[Rule in Re Atkinson]]. See [[WP:MOS#Section management]] -->
[[File:Chart of a trust.jpg|thumb|Chart of a trust]]
Trustees<ref>{{cite web|url=http://cyber.law.harvard.edu/trusting/unit5all.html|title=The New Palgrave Dictionary of Economics and the Law, Definition of "fiduciary duties" by Tamar Frankel Vol.2, p.127-128|publisher=Harvard Edu|access-date=2011-09-08|archive-date=2011-09-03|archive-url=https://web.archive.org/web/20110903233220/http://cyber.law.harvard.edu/trusting/unit5all.html|url-status=live}}</ref> have certain duties (some of which are [[fiduciary]]). These include the duty to:

* Carry out the expressed terms of the trust instrument.<ref name="Youyang">{{cite AustLII|HCA|15|2003|litigants=[[Youyang Pty Ltd v Minter Ellison Morris Fletcher]]  |parallelcite=(2003) 212 [[Commonwealth Law Reports|CLR]] 484 |date=3 April 2003 |courtname=auto}}.</ref> Trustees are bound to act in accordance with the terms of the trusts upon which the trustee holds trust property, and commit a breach of trust by departing from the terms of the trust.<ref name="Breen v Williams">{{cite AustLII|HCA|57|1996|litigants=[[Breen v Williams]] ("Medical Records Access case") |parallelcite=(1996) 186 [[Commonwealth Law Reports|CLR]] 71|date=6 September 1996 |courtname=auto}}.</ref> However, a trustee may act otherwise than in accordance with the terms of the trust if all beneficiaries, being ''sui juris'' and together absolutely entitled, direct the trustee to do so (or so consent). If any question arises as to the constriction of the provisions of the trust, the trustee must approach the court for determination of the question.
* Defend the trust
* Prudently invest trust assets (in [[New South Wales]], this is mandated by the ''Trustee Act 1925'' (NSW)<ref>{{cite Legislation AU|NSW|act|ta1925122|Trustee Act 1925}} ss14, 14A & 14C.</ref>).
* Be impartial among beneficiaries: the trustee must act impartially between individual beneficiaries<ref>{{cite AustLII|VicLawRp|70|1948|litigants=Tanti v Carlson |parallelcite=[1948] [[Victorian Law Reports|VLR]] 401 |date=2 April 1948 |courtname=[[Supreme Court of Victoria|Supreme Court]] (Vic)}}.</ref> as well as between different classes of beneficiaries.
* Account for actions and keep beneficiaries informed: these include a duty to inform beneficiaries as to their entitlements under the trust<ref>Hawkesley v May [1956]</ref> and other matters concerning the trust. Trustees do not have priority right to trust documents; it is a personal right and cannot be assigned<ref>Global Custodians v Mesh [2002]</ref> The right to seek disclosure of trust documents is an aspect of the court's inherent jurisdiction to supervise the administration of trusts.<ref>Schmidt v Rosewood Trust [2003]</ref> As trustees as not under a duty to disclose their reasoning in applying a trust power (unless the trust instrument requires otherwise), there is no duty to disclose any documents dealing with the decision making promise.<ref>Tierney v King [1983]</ref> Protection of confidentiality has been described as 'one of the most important limitations on the right to disclose of trust documents'. 'Memoranda or letter of wishes' do not necessarily need to be disclosed to a beneficiary if they are of a number of potential beneficiaries.
* Be loyal
* Not delegate
* Not profit; however, may charge fees for services to the Trust <ref>Case law authority ''Keech v Sanford'' [1726] EWHC Ch J76 [http://www.bailii.org/ew/cases/EWHC/Ch/1726/J76.html] {{webarchive|url=https://web.archive.org/web/20150512165432/http://www.bailii.org/ew/cases/EWHC/Ch/1726/J76.html|date=2015-05-12}}</ref>
* Not be in a conflict of interest position
* Administer in the best interest of the beneficiaries
The modern interpretation of fiduciary duty requires the consideration of environmental, social, and governance (ESG) factors as these are long-term investment value drivers.<ref>PRI, UNEP FI, & The Generation Foundation. [https://www.fiduciaryduty21.org/ Fiduciary Duty in the 21st Century] {{webarchive |url=https://web.archive.org/web/20180220151920/https://www.fiduciaryduty21.org/ |date=2018-02-20}}. 2018</ref> When evaluating whether an institutional investor has delivered on its fiduciary duties, both the outcomes achieved and the process followed are of critical importance.

The terms of the instrument that creates the trust may narrow or expand these duties&mdash;but in most instances, they cannot be eliminated. Corporate trustees, typically trust departments at large banks, often have very narrow duties, limited to those the trust indenture explicitly defines.

A trustee carries the fiduciary responsibility and liability to use the trust assets according to the provisions of the trust instrument (and often regardless of their own or the beneficiaries' wishes). The trustee may find himself liable to [[claimant]]s, prospective beneficiaries, or third parties. If a trustee incurs a liability (for example, in [[litigation]], for taxes, or under the terms of a lease) in excess of the trust property they hold, then they may find themselves personally liable for the excess.

Trustees are generally held to a "prudent person" standard in regard to meeting their fiduciary responsibilities, though investment, legal, and other professionals can, in some jurisdictions, be held to a higher standard commensurate with their higher expertise.<ref>see: ''Speight v Gaunt'' [1883] EWCA Civ 1 [http://www.bailii.org/cgi-bin/markup.cgi?doc=/ew/cases/EWCA/Civ/1883/1.html] {{webarchive|url=https://web.archive.org/web/20210418195025/http://www.bailii.org/cgi-bin/markup.cgi?doc=%2Few%2Fcases%2FEWCA%2FCiv%2F1883%2F1.html|date=2021-04-18}}</ref>-Trustees can be paid for their time and trouble in performing their duties only if the trust specifically provides for payment. It is common for lawyers to draft will trusts so as to permit such payment, and to take office accordingly: this may be an unnecessary expense for small estates.

In an exception to the duties outlined above, [[sabbatical officer]]s of [[students' union]]s who are also trustees of these organisations they work for do have the right to a salary (and hence profit from their being a trustee). This is an exception explicitly granted in the 1993 act<ref>{{cite web |title=CC3 – The Essential Trustee: What you need to know |url=http://www.charity-commission.gov.uk/Publications/cc3.aspx#f2 |publisher=Charity-commission.gov.uk |date=2008-04-01 |access-date=2012-03-05 |archive-date=2012-02-28 |archive-url=https://web.archive.org/web/20120228171609/http://www.charity-commission.gov.uk/Publications/cc3.aspx#f2 |url-status=live}}</ref>