Trust Deed Review

A trust deed is the constitution of the trust. Every question about what the trustee can do, who controls the trust, who can benefit and how the trust ends is answered by that document, not by general trust principles. Yet most trust deeds are signed once, filed, and never read again until something forces the issue.

A deed review is a lawyer reading the document and telling you what it says. It is usually requested before a transaction, before a change of control, or when an accountant notices that a planned distribution or restructure may not be as simple as it looks.

What we look at

The review covers the provisions that determine what you can and cannot do with the trust:

• Amendment power. Whether the deed can be varied at all, how far the power extends, who must consent, and whether any procedural requirements have been missed in earlier variations.
• Trustee appointment and removal. Who holds the power, whether it survives death or incapacity, and whether a corporate trustee can be substituted without difficulty.
• The appointor or principal. Whether the role exists, what it controls, how it passes on death, and whether succession has actually been documented.
• Beneficiary class. Who is in it, how wide it is, whether it can be narrowed, and whether it inadvertently includes people you would not want to include.
• Income and capital powers. How income must be determined and distributed, whether streaming is permitted, and what the deed requires by way of resolutions and timing.
• Vesting date. When the trust must end, and what the deed says happens to the property at that point.
• The chain of documents. Whether every variation, trustee change and appointor change since establishment is accounted for and properly executed.

The problems a review usually finds

Deed reviews tend to surface the same recurring issues:

• An amendment power narrower than the change the client intends to make.
• A variation made years ago without a consent the deed required, leaving its validity open to question.
• No appointor succession, so control of the trust is undefined after a death.
• A beneficiary class wide enough to include foreign persons, which can attract duty and land tax surcharges on Victorian land.
• A unit trust that is assumed to be a fixed trust but does not meet the tests that matter for tax purposes.
• A missing original deed, where only an unexecuted copy or a later variation survives.
• A vesting date closer than anyone realised.

None of these is unusual, and most are manageable if they are found before the transaction rather than during it.

If the original deed is lost

A surprising number of trusts cannot produce a signed original. That is a real problem, because the trustee's powers and the beneficiary class are only provable from the document. There are steps that can improve the position, including reconstructing the chain from later variations, accountants' files and the provider's precedent, and in some cases applying to the Court. What is appropriate depends on what can be established and what the trust is about to do. We advise on the options rather than treating a lost deed as fatal.

What you receive

A written review setting out what the deed provides on each of the points above, the issues we consider material, and what we would do about them. Where a proposed step is not open under the deed, we say so and set out the alternatives, including whether a variation is possible and what it would cost in tax and duty terms. Where the deed is sound, we say that too.

Reviews are quoted as a fixed fee once we have seen the size of the document chain.

This page is general information. It is not legal advice, and the terms of your particular deed will change the answer.