9 things that can still go wrong with family home trusts
We often hear from firms that they’re not too worried about trusts as they don’t act as trustees for ones that are GST registered or trading. However, no professional trusteeship is without risk.
The following are some things that can still go wrong with family home trusts:
(1) Ultra vires acts such as purchases, loans, investments and guarantees made without the full knowledge and consent of all trustees.
(2) Assets not insured.
(3) Assets not insured in trust’s name, leading to a claim being delayed or declined.
(4) Assets not adequately insured (trustees being potentially liable for the difference). (5) Invalid removal of trustees (See “Foiling the trust-busters” in our April newsletter).
(6) Poor investing. It doesn't need to be a trading or dedicated investment trust for the 'prudent person' standard to apply.
(7) Non-payment of liabilities.
(8) Invalid recording of all current beneficiaries.
(9) Potential advisor liability where trust mismanagement results in a loss to the trust.
So can Trustworks help?
Of course. If you use Trustworks you can achieve better-managed trusts with all trust documents stored and easily located in a single place. There are workflows, reminders and current precedents to ensure everything is done properly.
If you connect to clients through Trustworks, it allows trustees to see and participate in trust management. And you either have oversight of all trust activities in advance, or evidence of ultra vires actions.
Finally, Trustworks makes it easier to demonstrate to the trustees that the trust is well managed and to appropriately charge for ongoing administration and management.
Help to load trusts and companies available in Christchurch
We’ve recruited a new staff member to assist Christchurch firms with loading documents and data. We welcome our new recruit Chloe to the Connectworks team.
Chloe joins us having previously worked at Anderson Lloyd and is now working on her master's degree, so she'll be doing this part-time while she studies. Please let us know if you're interested in utilising her assistance at any time. Her rate is $26/h that we on-charge at net.
Join a webinar demonstration
Email your name and the date you’d like to attend to firstname.lastname@example.org and we’ll respond with login details.
Companyworks – Wed. 12 July @ 9am and Mon. 17 July @ 9.30am
Trustworks – Thurs. 13 July @ 10.30am and Tues. 18 July @ 9.30am
Portal – Fri. 14 July @ 10.30am and Tues 18th July @ 11am
Webinar on using precedents
We’re running a short webinar on using our precedents for both subscribers and non-subscribers of Trustworks and Companyworks. It will cover how to find them and auto-populate them, ready for signing. It will also cover building resolutions using our clause library and how firms can create and maintain their own templates within our products for their exclusive use.
The webinar will be on Wednesday 12th July at 11am and take no longer than 15 minutes. To take part, please email email@example.com with ‘precedent webinar’ in the heading and we’ll respond with the login details.
New Companyworks interests register categories
We’ve expanded categories you will see in the directors interests register in Companyworks in order to make it easier to meet the requirements of the Companies Act. They are now broken down as follows:
Directors Benefits, General Disclosures, Indemnities, Specific Disclosures, Use of Information.
You will see these automatically on new companies imported in Companyworks and we’re making some changes to enable these to be used for companies already in the product.
New and updated trusts precedents
The team have been busy. This month we’ve added;
Cert223.1 Amalgamation (s222(1)) in Accordance with the Companies Act
Cert223.2 Amalgamation (s222(2)) in Accordance with the Companies Act
Cert223.3 Amalgamation (s222(1)) not to Prejudice of Creditors
Cert223.4 Amalgamation (s122(2)) not to Prejudice of Creditors
Res222.1 Amalgamation (amalgamating with subsidiary)
Res222.2 Amalgamation (amalgamating with parent company)
Res222.3 Amalgamation (common owner; Company the amalgamated company)
Res222.4 Amalgamation (common owner)
Min222.1 Amalgamation (amalgamating with subsidiary)
Min222.2 Amalgamation (amalgamating with parent company)
Min222.3 Amalgamation (common owner; Company the amalgamated company)
Min222.4 Amalgamation (common owner)
Cert1 Certificate of Authorised Person
Cert33 New form of constitution
Cert47 Certificate in respect of consideration for issue of shares
Cert47.1 Certificate in respect of consideration for issue of shares
Cert60.1 Offer to acquire shares
Cert61 Offer to acquire shares
Chkl1 Accounting Records
Chkl10 Call on Shares
Chkl11 Change of Name
Chkl12 Company Records
Chkl13 Consolidate Shares
Chkl15 Credit Shares other than Cash
Chkl16 Divides (s107)
Chkl19 Issue of Shares (s42)
Chkl20 Issue of Shares (s44)
Chkl27 Removal of Director
Chkl28 Remove Alternate Director
Chkl29 Resignation of Director
Chkl33 Subdivide Shares
Chkl35 Transmission of Shares
Chkl38 Issue of Shares (s107(2))
Chkl4 Appointment of Appointor
Chkl42 Repurchase of Shares (non-listed company)
Chkl43 Death of Director
Chkl44 Objection to Removal from Register
Chkl45 Objection to Restoration of Company
Chkl46 Removal from Register (s317)
Chkl7 Appointment of director
Chkl9 Bonus Shares
Let318 Removal from Register
Min117.1 Alteration of the Constitution (Meeting of an Interest Group)
Min117.2 Revocation of the Constitution (Meeting of an Interest Group)
Min156 Removal of director
Min159 Change of directors
Min187 Change of Registered Office
Min23 Change of Name
Min318 Special meeting of shareholders
Min32.2 Revocation of the constitution (Special Meeting of the Shareholders)
Min44 Issue shares (meeting of Directors)
Min47.1 Consideration for the issue of shares
Min53 Authorisation of a Dividend
Min60.1 Offer to acquire shares
Min69 Redemption of shares at the option of the Company
Min75 Redemption of shares on a specified date
Min93.2 Transmission of shares (section 93(2) Companies Act 1993)
No69 Redemption of shares at the option of the company
Not100.1 Call on the issue price of partly paid shares (notice to shareholders)
Not100.2 Default in the payment of a call
Not117.2 Revocation of the Constitution (Notice to the Shareholders of an Interest Group)
Not117.3 Issue of Shares (Notice to the Shareholders of an Interest Group)
Not122.2 Notice of Shareholder Resolution and Statement of Shareholder Rights
Not156 Removal of director
Not189 Notice of place accounting records to be kept (section 189 Companies Act 1993)
Not195 Notice of Place Accounting Records to be Kept (section 195 Companies Act 1993)
Not318 Notice to the Shareholders
Not32 Adoption of a Constitution (Notice of Special Meeting of the Shareholders)
Not32.1 Alteration of the Constitution (Notice of Special Meeting of the Shareholders)
Not93.3 Transmission of Shares by Survivorship
Res 60.1 Offer to Acquire Shares
Res107 Issue of Shares
Res120 Call Annual meeting of shareholders
Res159 Notice of change of directors
Res187 Change of Registered Office
Res318 Removal of the company from the New Zealand register
Res47.1 Consideration for the issue of shares
Res53 Authorisation of a Dividend
Res61 Offer to acquire shares
SRes107.3 Acquisition of Shares
SRes117.2 Revocation of the Constitution (Special Resolution of the Shareholders of an Interest Group)
SRes153 Appointment of director