Elspeth Talbot Rice KC and Ben Waistell explore the future of private family trusts in their article ‘Looking over the horizon: issues for the future in private family trusts’ for IMG Trust. Their piece focusses on the evolving landscape of trust law, addressing challenges trustees face amid changing societal norms and technological advancements.
INTRODUCTION
Perhaps more than any other area, it is the constant challenge of the trustees of private trusts to meet new circumstances with old tools. A typical family trust may have been settled decades in the past and over its lifetime there will be inevitable changes in societal and moral attitudes, and in technological and medical advances. Yet, trustees must act in accordance with the terms of their trust which will have been stipulated at the time the trust was settled. This divergence between the original purpose and terms of the trust when it was settled (affected by the social mores when it was settled) and later developments in the way in which we live our lives (and what is acceptable in that connection), will continue to create challenges for trustees in the administration of family trusts in the future.
This article discusses two key challenges for trustees which in our view are likely to take centre stage in the not too distant future. First, we consider the long-standing challenge for trustees of private trusts in responding to developing aspects of modern families: many trusts are settled for the benefit of X’s issue; but what issue means has changed over time. Does it, or will it come to, include children born through surrogacy arrangements? Secondly, we consider the increasing focus on ESG considerations in investment decisions: are trustees of private family trusts safe to prioritise ESG factors when deciding how to invest the trust’s funds? We conclude by considering the difficulty created for trustees by developments which were unforeseen when the trust was settled, in the light of the trustees’ duty to administer the trust in a way which is consistent with the settlor’s purpose and intentions when it was settled (before these new developments were known or anticipated).
