Equity and Trusts Essay Example | Topics and Well Written Essays - 1500 words - 3

Equity and Trusts - Essay Example Jeremy Fanshawe, being a the trustee of the estate of his late father with sole beneficiary as his son, Kelvin as well as trustee of a small family trust or â€Å"joint trust† where the beneficiaries are his ex-wife Lydia and their adopted daughter Miriam, has a sensitive role in not only ensuring that the trusts are managed effectively but also beneficiaries received their share. As trustee, he has the fiduciary duty to enforce the agreed contents of the contract he has signed with his late father as well as the small family trust or joint trust2. Under the UK law, he is required a duty of care which is Part 1 of the Act wherein as trustee, Jeremy is expected to be reasonable3: (b) if he acts as trustee in the course of a business or profession, to any special knowledge or experience that it is reasonable to expect of a person acting in the course of that kind of business or profession†4. This would require Jeremy to have prior knowledge and sufficient effort exerted to determine the viability of conducting the business about purchase of art works by the artist Farrah Foster as an investment. Whilst his first purchase, a painting, indeed increased value from  £13,000 to  £26,000, the manner of which this â€Å"investment† has been undertaken without clear purpose and process.  £20,000 worth of money was transferred from the joint trust account to his personal current account. Section 2 of the Schedule specifies that â€Å"when exercising any corresponding power, however conferred† 5 under Compounding Liabilities. On Part II Investment Section 4, it was required under Standard investment criteria, the trustee upon exercising power of investment, whether arising under this Part or otherwise, the trustee must have expertise to the standard investment criteria6. On the same manner, The Act also provides that: â€Å"Application of duty of