Chapter 16 Self-Test Questions

When will the court confer powers on a trustee that are not found in the trust instrument?

When it is fair to do so.

When an injustice would be caused to the beneficiaries in not doing so.

When there is an inconvenience for the beneficiaries.

When it is expedient to do so.

'The Variation of Trusts Act 1958 affords the court the power to alter any aspect of the trust, except for the beneficial interests.'

True.

False.

Why was the Variation of Trusts Act 1958 necessary?

Too many beneficiaries complained about the terms of the trust instrument.

To give the court the power to consent to the variation of the trust on behalf of beneficiaries who are unable to consent.

To recognize that settlors often make mistakes in drafting trust instruments.

To codify the rule in Saunders v Vautier.

'The court will not approve an application to vary the trust if its sole objective is to reduce the tax consequences of the trust.'

True.

False.

When does the court's approval of a scheme of variation become effective?

It is automatically effective.

It is effective once approved by the settlor.

It is effective once all of the beneficiaries have agreed.

It is effective only once approved by the trustees.

Quiz Content