The New Zealand Trustee Act 2019 has been passed, and although this doesn’t come into full force until 30 January 2021, Greenlion say there is quite a lot to take in. The purpose of this Act is to restate and reform New Zealand trust law setting out the core principles of the law relating to express trusts; and providing for default administrative rules for express trusts; and providing for mechanisms to resolve trust-related disputes; and making the law of trusts more accessible.
Greenlion explain that there are a number of changes that affect all trusts, and some of the biggest are enumerated as follows. Firstly, trustees must inform all beneficiaries of the trust that they are beneficiaries and that they can request information about the trust.
Secondly, at least one trustee needs to hold all the core documents and records of a trust and keep them updated, and thirdly, the maximum duration of a trust (the perpetuity period) has been extended from 80 years to 125 years.
Trustee duties have now been clarified:
Know the terms of the trust
Act in accordance with the terms of the trust
Act honestly and in good faith
Act for the benefit of beneficiaries or to further the permitted purpose of the trust
Exercise powers for proper purpose
General duty of care
Not to exercise power for own benefit
Consider exercise of power
Not to bind or commit trustees to future exercise of discretion
Avoid conflict of interest
Duty to be impartial
Duty not to profit
Trustee must act for no reward
Trustee must act unanimously
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