Spotlight back on Trusts
A new Trusts Act may be enacted in 2017 which would be the culmination of a process of trust law review that began in March 2009.
It would herald the first significant change in 60 years by updating and improving the Trustee Act 1956.
There have been several milestone dates since the Government asked the Law Commission in 2009 to have a look at how the existing law could be modernised and made clearer.
13 November 2012
The release of the Law Commission's Preferred Approach Paper following the publication of 5 Issues Papers.
11 September 2013
The release of the Law Commission Report on the Review of the Law of Trusts.
1 March 2014
The Government response to the Report which accepted the recommendation for a new Trusts Act but indicated that further analysis was required.
24 October 2014
A statement by new Justice Minister Amy Adams that there was no timetable for developing a new Trust Act which seemed to signal that law reform in this area had slipped down the Government's priority list.
29 May 2015
Amy Adams puts Trust law reform back on the agenda by announcing that a Trusts Reference Group had been
formed comprising 7 expert trust lawyers to assist the Government with progressing the Law Commission 2013 Report
10 November 2016
The release of the Trusts Bill exposure draft seeking the submission of feedback by 21 December 2016
It is now widely expected that a final version of the Bill will be introduced to Parliament in 2017 and passed into law.
The world most definitely changed in 2016; and, with a new Trusts Act on the horizon the world from a Trustee perspective will certainly change from 2017 and beyond.
Prudent Trustees will be starting to prepare themselves for those changes and challenges now.
Did you know?
There are an estimated 300,000 to 500,000 trusts operating in New Zealand
An estimated 15% of private houses are held in a trust
The origin of trusts can be traced to the first crusades in the 11th century when English knights left their manors and estates in the care of trusted friends of safekeeping while they were away.
In order to sell certain residential property owned by a trust, an IRD number will have to be provided by that trust because of the "bright line" test for trusts and residential real estate which became operative from 1 October 2015.