Compensation Protection Service

This is a very important decision. You should make sure that the trustees are:

• All over 18 years and mature.
• Fair minded.
• Sensible.
• Practical.
• Prompt at dealing with things.
• Good with money.
• Not under any adverse influence.
• Not in any financial difficulty.
• Not likely to 'fall out' with your client or the other trustees.
• Able to work with others as a team.
• Only interested in your client's best interests.
• Not subject to any conflict of interest with your client.

Please note:

a. There should be at least two trustees, preferably three.

b. Your client should not be a trustee of their own Compensation Protection Trust (Personal Injury Trust or Disabled Trust) for legal and practical reasons.

c. Having an independent professional trustee such as ourselves is often viewed as an advantage. We would be pleased to act as a trustee with your client's chosen family/other appointees or even provide all the trustees if you wish.

The following summary refers equally to the position of lay trustees such as family members as to professional trustees.

Trustees must:

• Not be undischarged bankrupts. Trustees should voluntarily resign if they have any financial difficulties.

• Disclose any circumstances where they might have a conflict of interest with a beneficiary for example if a beneficiary owes a trustee money this should also be disclosed

• Not act in conflict with the interests of the beneficiary or profit from their role as trustee.

• Ensure they know what the terms of the trust are and that they are carried out.

• Ensure that they do not act beyond the terms of the trust and their powers given by it. Before doing anything with the trust fund it is advisable to take our advice.

• Ensure that good trust records and accounts are kept and that tax due is paid on time. Our trust team can do this essential work for you.

• Take independent financial advice. This does not preclude the use of common sense. The trustees must also ensure that the advice taken is in accord with the Trustee Act 2000. The ultimate decision over what to invest in is the trustees' decision. It cannot be delegated.

• Act impartially and fairly.

• Take reasonable care. Professional trustees have a greater duty of care than lay trustees.

• Act jointly. Trustees should not normally delegate functions to each other. Trustees are jointly liable for mistakes and should therefore act together.

• Lay trustees may not charge fees. Only professional trustees can claim more than their out of pocket expenses.

• Ensure the beneficiaries are kept fully informed. This avoids disputes.

Yes.

But it is best to try to pick the right ones at the outset.

You should note that if we are appointed as a trustee to the trust fund we would usually continue to carry out normal trustee services after formation.

You will appreciate that we take our legal responsibilities as trustees very seriously and believe that your client will benefit from our continued involvement.

We are also bound by the Solicitors Accounts Rules which impose certain money handling requirements for security if we act as a trustee or as sole trustees. Obviously we aim to be as cost effective as possible.

Yes.

But it is rarely advisable to do so.

If the beneficiary and the trustees:

• are confident enough that they can fulfill the legal requirements of running a trust arrangement and

• agree that they want to deal with matters themselves,

There is no legal reason why once the trust is properly constituted, the family or other non-professional trustees should not take over the administration of the trust, calling on outside professional advice when needed. In practice few people do this and clients invariably feel that is is well worth the costs, which we keep to a minimum, to ensure that the trust is properly administered. Trusteeship is an onerous responsibility and carries with it specific legal duties.

If your client does not wish to continue to use our services after the trust is founded then you will need to advise us that they wish not to continue with us and nominate a third party who will take over responsibility for administering the trust. We will pass them all relevant documents. If you do not do this then our Trust Administration Team will continue to deal with the trust in the normal way and the normal charges will apply. 

After the trust deed is signed the trust fund must then be 'constituted' to validate the legal existence of the Compensation Protection Trust (Personal Injury Trust or Disabled Trust).

That means payment of compensation for the injury must be paid into the trustee account. Usually the initial trust fund, the amount of money due for the personal injury, is paid into a suitable trust client account here at Wrigleys by the personal injury lawyer acting in the claim.

As soon as the compensation monies are received, we place the trust fund on deposit at our bank, Natwest, in a specially designed client account. During that period we can make such payments as are needed to the beneficiary.