MSPs propose stronger trust and succession law reforms
Proposed reforms to Scots trusts and succession law are very welcome, but should be strengthened to make sure they stand the test of time, according to a Holyrood committee.
In its stage 1 report on the Trusts and Succession (Scotland) Bill, the Delegated Powers and Law Reform Committee says it wants the Government to address issues around the power of trustees to make environmental, social or ethical investments, and the duty of trusts to communicate with beneficiaries.
The bill would substantially reform the outdated Scots law on trusts in line with recommendations of the Scottish Law Commission. It also takes forward certain limited reforms to the law of succession.
Among its comments in the report, the committee:
- asks the Government to consider greater involvement of the sheriff court alongside the Court of Session as the court for trusts;
- recommends greater safeguards against the risk of abuse of provisions for removal a trustee;
- seeks clearer provisions on the interaction between trusts and charities legislation;
- calls for amendments, for the avoidance of doubt, to explicitly allow trustees (subject to the terms of the trust deed) to choose to invest in environmental, social and governance investments;
- asks the Government to consider a starting point of no personal liability for trustees where trust assets are insufficient to meet expenses of litigation;
- suggests adding a general power to the court to give directions to trustees.
It also believes the Government should pursue an order under s 104 of the Scotland Act 1998 to enable the bill to apply to pension scheme trusts.
On succession reforms, the report calls for an amendment to clarify that the law does not permit an unlawful killer to be an executor of their victim’s estate. The MSPs also consider that it would be inappropriate for a person charged with murder or culpable homicide to act as executor during the course of the prosecution.
They also recommend that the bill is amended to extend the current six-month period for cohabitants’ claims to a deceased person’s estate under the Family Law (Scotland) Act 2006 to 12 months.
Committee convener Stuart McMillan MSP commented: "The committee, like those we took evidence from, is enthusiastic about the prospect of a new, modernised trusts and succession law. It’s a long time coming and will be warmly welcomed.
"But we must make sure that this new bill stands the test of time. Witnesses raised a number of areas where the bill could be clearer or lacks detail.
"Users of trusts and those affected by succession law come from all walks of life. They need a bill that is easy to use, protects them and their loved ones, and simplifies the processes involved."