A Trust Deed is an important legal document that outlines how the Trust’s assets are managed and distributed, identifies the trustees and beneficiaries and details the rights, powers and obligations of the parties involved. RMB Lawyers Partner ADAM BARLOW explains what steps you can take if you can’t locate this vital document.
Trusts come in many different types including Discretionary Trusts, Unit Trusts and Testamentary Trusts.
Retaining the original Trust Deed is vital for the ongoing administration of a Trust. But what happens if the original Trust Deed is lost?
The starting position is whether a copy of the Trust Deed can be found. If so, the steps available are slightly less complicated than if a copy cannot be found.
In terms of locating a copy, traditionally the following organisations may keep a copy: your accountant; your lawyer; your bank (if you have a Trust bank account); or the Supreme Court Probate Registry (if it was a Testamentary Trust).
The safest course of action is to apply to the Supreme Court for advice, direction and a declaration about the terms of the Trust. In order to make any declaration, the Court will need to know the terms of the original Trust Deed. If a copy can be found and it has been followed by the parties, then the Court is likely to declare the terms in the copy to form the terms of Trust Deed.
If no copy can be found, it will be necessary to satisfy the court that a Trust Deed once existed and describe the terms of the Deed. This could require evidence from the parties involved in the drafting of the Deed - a significant task if the Trust was settled some time ago.
If a copy can be located, you could consider a Deed of Confirmation or Ratification. This Deed, in effect, confirms the terms of the Trust based on the copy. This approach is not without risks as third parties such as banks and the ATO may not recognise the Deed of Confirmation.
Issues such as a Resettlement or a breach of the Rule against Perpetuities may arise with a Deed of Confirmation, so an approach to the Supreme Court will always be the safest.
In you have lost your Trust Deed it is important to get legal advice so that you are aware of the possible consequences of the situation.
If you need some assistance with a Trust Deed, your first step should be to contact our office to arrange a consultation. You can contact us by by phone or our 'Ask a Question' tool on our website.