|NEW TRUST LAW – BE AWARE!
This article was written by Lewis Gibson and Pip Childs.
It is estimated that there are some 300-500,000 trusts currently in existence in New Zealand. For many New Zealanders, trusts have played an important role in long-term asset management and succession planning.
Over the past several years, the New Zealand Law Commission has undertaken a detailed review of the law regulating how trusts operate currently and what changes could be made to bring the legislation into the 21st century. Following the Commission’s recommendations, the Government has passed the Trusts Act 2019, which will come into force on 30 January 2021.
The main purposes of the new legislation are to embody in one statute principles that have been established by over 60 years of case law and to modernise trust structures to reflect the current environment in which we manage our assets. Once the new Act comes into force, it will apply to all trusts whether they are in existence now or created in the future.
The new Act contains a large number of changes, but those which are likely to have the largest impact can be broadly broken down into 3 categories:
- the duties of trustees;
- the rights of beneficiaries:
- the way disputes are resolved.
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