Accountability and duties of Trustees
Trust law imposes strict obligations and rules on Trustees. There is a basic rule that a Trustee may not derive any advantage, directly or indirectly, from a trust unless expressly permitted by the trust - for example, where there is a professional Trustee and the trust provides specifically for its right to make reasonable charges for services. Full disclosure of the basis and amount of charges is required. The most important rule relating to the duties of a Trustee is that requiring them to obey the directions contained in the Trust Deed regarding both the interests of the beneficiaries and managing the trust property. Trustees are also subject to very strict rules governing the way in which their powers and discretion may be exercised.
In the case of a professional Trustee, the standard of care that the law imposes is higher. Professional Trustees hold themselves out as having special expertise and the courts will expect them to exercise a high standard of competence. Failure to exercise the requisite
level of care will constitute a breach of trust for which the Trustees will be liable to compensate the beneficiaries. This duty can extend to supervising the activities of a company in which the Trustees hold a controlling shareholding.