- within Corporate/Commercial Law topic(s)
- in United States
- within Corporate/Commercial Law, Criminal Law and Real Estate and Construction topic(s)
Trustees play a crucial role in safeguarding the interests of those they serve but when it comes to vulnerable beneficiaries, the responsibility extends beyond standard fiduciary duties.
In this guest article, Holly Chantler ofMorr & Co explores how trustees can recognise and respond to vulnerability among beneficiaries, outlining both the legal framework and practical steps that help ensure fairness, understanding, and protection.
From recognising signs of vulnerability to adapting communication and maintaining clear records, Holly highlights how a considered and compassionate approach can make a meaningful difference in trust management.
Trustee Duties: Legal and Practical Framework
Trustees must act in accordance with the trust instrument, statute and common law fiduciary duties. Core duties include:
- Acting in the best interests of all beneficiaries (impartiality and fairness)
- Following the terms of the trust
- Exercising reasonable care and skill
- Keeping accurate records and accounts
- Avoiding conflicts of interest
- Acting unanimously (unless the trust instrument provides otherwise)
- Complying with statutory duties, including the duty of care and the duty to take advice where appropriate
Trustees are also expected to take account of the needs and circumstances of vulnerable beneficiaries, ensuring their interests are properly protected.
Recognising Vulnerability
Vulnerability can affect any one at any time and may arise from a range of factors, including:
- Health issues (chronic illness, disability, mental health)
- Financial hardship
- Major life events (bereavement, divorce, retirement)
- Social isolation
- Age (both young and elderly beneficiaries)
- Cognitive impairment (dementia, learning disabilities)
- Lack of support networks
- Substance abuse
Trustees should be proactive in identifying vulnerability, regularly reviewing beneficiaries' circumstances and keeping up to date with best practice and legal requirements.
Meeting the Needs of Vulnerable Beneficiaries
Adjustments to Promote Understanding and Involvement
Trustees should consider and, where appropriate, make reasonable adjustments to promote beneficiaries' understanding and involvement in decision-making. This may include:
- Using clear, jargon-free language
- Providing information in accessible formats
- Allowing extra time for meetings or decisions
- Involving trusted advisors, family members, or advocates (with the beneficiary's consent)
- Checking understanding and encouraging questions
Capacity and Information Sharing
If a trustee has concerns about a beneficiaries capacity, they may require a specialist capacity assessment to be carried out. The assessment should address the decision in question.
If a beneficiary lacks mental capacity to make decisions, trustees must:
- Ensure that information is only shared with someone who is legally authorised to act on the beneficiary's behalf (such as an attorney authorised to act beyond a loss of capacity) or where the law permits it (such as pursuant to a court order)
- Keep clear records of any assessments of capacity and the basis for sharing information
- Continue to act in the best interests of the incapacitated beneficiary, seeking professional advice where necessary
Effective Communication and Record-Keeping
Trustees should:
- Exercise active listening and empathy
- Consider regular check-ins with vulnerable beneficiaries
- Document all communications and decisions, including the basis for decisions affecting vulnerable beneficiaries
- Demonstrate that decisions are made in the best interests of the individual and the trust as a whole
Policy Development and Review
Trustees should:
- Develop and regularly review policies for identifying and supporting vulnerable beneficiaries
- Involve beneficiaries and stakeholders in policy development where possible
- Signpost beneficiaries to external support services (e.g., social services, advocacy, mental health support) where appropriate
- Develop partnerships with local agencies to strengthen support for vulnerable individuals
Conclusion
Trustees play a vital role in safeguarding the interests of vulnerable beneficiaries. By understanding the triggers and factors contributing to vulnerability, complying with legal duties, making reasonable adjustments, and adopting effective communication and safeguarding strategies, trustees can provide the necessary support to ensure the well-being and involvement of all beneficiaries.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
