100 years in the making - a welcome update to trusts law in Scotland

The Scottish Government’s Programme for Government 2022/23 announced the introduction of a bill to reform the law governing trusts in Scotland.  The legislation has been welcomed by the Scottish Law Commission which published recommendations and a draft Bill in its 2014 Report on Trust Law, revised in 2018. 

The proposals in Part 1 of the Trusts and Succession (Scotland) Bill aim to consolidate, reform and modernise the law governing the operation of trusts in Scotland.  The Bill updates the law governing Trustees, the parties appointed to administer trusts, and focuses on:

• the kind of investments they can make;
• their duty of care in relation to their role;
• who can be appointed to the role or not;
• how to terminate the appointment of a trustee, either by resignation or removal;
• the information a trustee must provide to other people, including the trust’s beneficiaries;
• the requirements for decision-making; and
• the management of private purpose trusts.

The primary legislation, the Trusts (Scotland) Act 1921, which is more than 100 years old, has been amended several times.  This has made trust law in Scotland unnecessarily complicated and largely inaccessible for the parties involved to understand what their legal rights and duties are. Trusts can be used for a wide range of different purposes, from commercial use and contract law to pensions, property and family law.  They can also be used for dealing with the assets of a disabled person or young children. If you are involved in a trust and require advice on your rights or wish to discuss the possibility of putting a trust in place, please do not hesitate to get in touch.