If an under-age child (under 18) receives a bequest in a will and there are no trustees, or if a child inherits on intestacy, the legal personal representative (LPR) faces the difficulty that there is nobody in whom he can vest the asset or from whom he may obtain a receipt.
(The Age of Majority Act, 1985 provides that a person shall attain full age when he/she attains the age of 18 years.)
This is the most critical reason why a trust should be inserted in a will where there are minor children.
However, if this does not occur all is not lost because section 57 of the Succession Act, 1965 helps out:
|57.—(1) Where an infant is entitled to any share in the estate of a deceased person and there are no trustees of such share able and willing to act, the personal representatives of the deceased may appoint a trust corporation or any two or more persons (who may include the personal representatives or any of them or a trust corporation) to be trustees of such share for the infant and may execute such assurance or take such other action as may be necessary for vesting the share in the trustee so appointed. In default of appointment the personal representatives shall be trustees for the purposes of this section.
|(2) On such appointment the personal representatives, as such, shall be discharged from all further liability in respect of the property vested in the trustees so appointed.
This means that where under-age children inherit and there are no trustees to give a receipt to the LPR the personal representative(s) can appoint trustees, including themselves.
In fact, if no trustees are so appointed the personal representatives are deemed to be trustees for the purpose of section 57.
However, section 57 only applies to the share of a minor, not anyone else who is unable to give a proper receipt to the executors.
The Powers of the Trustee
Trustees are allowed to hold property vested in them under section 57 of the Succession Act, 1965, and their powers are set out in section 58:
|58.—(1) Property vested under section 57 may be retained in its existing condition or state of investment or may be converted into money and invested in any security in which a trustee is authorised by law to invest, with power, at the discretion of the trustees, to change such investments for others so authorised.
|(2) Where an infant becomes entitled to any estate or interest in land on intestacy and consequently there is no instrument under which the estate or interest of the infant arises or is acquired, that estate or interest shall be deemed to be the subject of a settlement for the purposes of the Settled Land Acts, 1882 to 1890, and the persons who are trustees under section 57 shall be deemed to be the trustees of that settlement.
|(3) A person who is sole trustee under section 57 shall be entitled to receive capital trust money.
|(4) Persons who are trustees under section 57 shall be deemed to be trustees for the purposes of sections 42 and 43 of the Conveyancing Act, 1881.
|(5) Without prejudice to any powers under the said sections 42 and 43, persons who are trustees under section 57 may at any time or times pay or apply the capital of any share in the estate to which the infant is entitled for the advancement or benefit of the infant in such manner as they may, in their absolute discretion, think fit and may, in particular, carry on any business in which the infant is entitled to a share.
|(6) The powers conferred by subsection (5) may also be exercised by the surviving spouse as trustee of any property of an infant appropriated in accordance with section 56.
Section 58(2) above sets out the situation when an infant becomes entitled to land in an intestacy situation.
The Land and Conveyancing Law Reform Act, 2009, section 20, updated and clarified the powers of the trustee, and this act significantly amended the law relating to trusts from 1st December, 2009.
|20.— (1) Subject to—
|(a) the duties of a trustee, and
|(b) any restrictions imposed by any statutory provision (including this Act) or the general law of trusts or by any instrument or court order relating to the land,
|a trustee of land has the full power of an owner to convey or otherwise deal with it.
|(2) The power of a trustee under subsection (1) includes the power to—
|(a) permit a beneficiary to occupy or otherwise use the land on such terms as the trustee thinks fit,
|(b) sell the land and to re-invest the proceeds, in whole or in part, in the purchase of land, whether or not situated in the State, for such occupation or use.
Section 18 created the new statutory model of a “trust of land”, which covers all forms of trust of land, including where land is vested in a minor, regardless of whether the land vest before or after 1st December, 2009.
Section 19 sets out who are the trustees in each case of trust.
A parent, by deed or will, can appoint another person(s) to be guardian of their children after their death. A testamentary guardian can act jointly with the surviving parent, provided the surviving parent does not object, in which case he/she can apply to court for an order under section 7 of the Guardianship of Infants Act, 1964.