Chapter 16 Scenario Questions

Simone declares a fixed trust of £50,000 in favour of her daughter Belinda, her son Brendan, and Brendan's two children, Bianca and Ben. Bianca and Ben are aged 10 and 12. Brendan wishes to alter the terms of the trust. Belinda disagrees.
Can Brendan alter the terms of the trust?

Brendan is an absolutely entitled under the trust and so can alter it under the rule in Saunders v Vautier.

Brendan cannot alter the trust as this requires a majority decision from all of the beneficiaries; as Belinda does not agree and the other two beneficiaries are too young to consent, Brendan cannot alter the trust.

Brendan can apply to the court to have the trust altered under the Variation of Trusts Act 1958. If the court agrees that it is in the best interests of Bianca and Ben to alter the trust, then it will alter the instrument.

Brendan can apply to the court to have the trust altered under the Variation of Trusts Act 1958. As Belinda does not agree, however, the court cannot make an order altering the trust.

Freddy declares a trust in favour of his daughter, Francesca, with remainder to Francesca's children. In the event that Francesca dies without any children, then the property will go to Francesca's cousin, Mildred. Francesca is yet to have any children. Francesca is seeking the alteration of the terms of the trust instrument.
Under the Variations of Trusts act 1958, can the court consent to the alteration to the terms of the trust?

The court can consent to the alteration on behalf of any unborn children but not on behalf of Mildred.

The court cannot consent to the alteration at all.

The court can consent to the alteration on behalf of Mildred as she will be entitled to benefit under the trust in the event that Francesca dies without having had any children.

The court can consent to the alteration on behalf of both Mildred and any unborn children.

Arya and her daughter Lili are beneficiaries under a trust. The trust instrument includes a forfeiture provision which states that if either beneficiary became vegan then they would forfeit their interest under the trust, with the forfeited portion accruing in favour of the other beneficiary. Arya eats meat, but Lili is a vegan.
Would the court approve Arya and Lili's application to alter the terms of the trust to remove the forfeiture clause?

Likely no, removing the forfeiture clause would be financially damaging to Arya.

Likely yes, forfeiture provisions in trust instruments are automatically void.

Likely no, to do so is clearly contrary to the settlor's intention.

Likely yes, removing the forfeiture clause would be for the benefit of the family.

Frieda is 30 years old and has a life interest under a trust with Fabian taking absolutely on her death. Fabian is 16. Frieda sought to alter the trust so that both Frieda and Fabian would hold 50 per cent of the trust property.
Would Frieda succeed in attempting to alter the trust?

Frieda would not succeed as this clearly defeats the intentions of the settlor.

Frieda would not succeed as Fabian is unable to consent under the rule in Saunders v Vautier and, as he is nearly 18, the court would not be able to consent on his behalf.

Frieda may succeed as the proposed alteration would benefit Fabian.

Frieda would succeed as she has a life interest and so could alter the trust under the rule in Saunders v Vautier.

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