UK Equity and Trusts

Lord Amstrad, the well-known socialist billionaire, died on 1st April, 2004. His will, executed on 1st February, 1993, states:

"Everything I own is to be sold by my trustees. The resulting fund is to be distributed, subject to paying a reasonable income to my niece Josephine during her lifetime, to underpaid nurses and ancillary staff working in the National Health Service."

In the distribution of Lord Amstrad's estate in accordance with his above-stated will, there are several factors that the trustees must consider. First of all, the trustees must determine what constitutes Lord Amstrad's "estate." Then, they have to determine what is a "reasonable income" for Josephine and what form of disbursement would be the most efficient. Once Josephine's portion is secured, the trustees must select a method in which they can best distribute the remainder of Lord Amstrad's estate to the underpaid nurses and ancillary staff working in the National Health System. In addition to the issue of the estate, the trustees must also maintain the duty of care required of trustees. Taking these factors into consideration, a portion of Lord Amstrad's estate is to be distributed via a discretionary trust for his niece, Josephine, and the remainder shall be distributed through a charitable trust instrument to the underpaid nurses and ancillary staff working in the National Health Service ("NHS").

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Josephine's portion is allocated, the trustees must then determine how to disburse the remaining estate in a way that would best conform with the intention stated in Lord Amstrad's will. In his will, he specifically states that the remainder of his estate goes "to underpaid nurses and ancillary staff working in the National Health Service." For the purposes of this disbursement, a charitable trust would be a better fit than a private trust. A private trust requires that there are "ascertainable beneficiaries" (Warburton 24). Unlike the initial apportionment in which the beneficiary is a named individual, the beneficiaries of the second disbursement is a category of the population. Thus, it is not clear whether the recipients of the second disbursement (to NHS underpaid employees) could be determined as ascertainable beneficiaries. As distinguished from a private trust, a charitable trust does not require such ascertainable beneficiaries. Instead, as long as "a gift shows a charitable intention it will be enforced by the courts even if there are no clearly defined objects" (Warburton 25). In this case, Lord Amstrad has specified that the funds go towards certain individuals, as opposed to a general charitable purpose. Ho
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Approximate Word count = 1849
Approximate Pages = 7 (250 words per page)

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