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Problem scenario
Trudy has been appointed trustee. The trust deed contains the following clause:
The trustees shall be entitled to all professional charges incurred in the execution of the trust and shall be entitled to delegate all or any of their duties in accordance with the general law.
Trudy has accepted the trust, even though she is a total amateur and rather ignorant of business affairs. She purchases a large quantity of office equipment and stationery to facilitate the smooth running of her tasks but still finds that the job is too complicated. After putting in several months of work in service of the trust she eventually enlists the assistance of a friend who, having run his own betting office for many years, is more at ease with commercial matters. She transfers the trust fund into the friend's bank account with the instruction that he should invest it wisely for the benefit of the trust. In fact, the friend 'invests' the money on Lucky Laddie, the favourite to win a greyhound race. Lucky Laddie loses the race and the trust fund is lost.
Is Trudy liable for breach of her trust, and why? If she is liable, will she be required to reinstate the full value of the fund, or can she claim remuneration and or expenses?