Trusts
What is a Trust?
A trust is an arrangement whereby a person or organisation holds property for the benefit of someone else. The Public Trustee administers many types of trusts which include the management of moneys awarded through workers compensation, motor vehicle accidents for incapacitated persons, testamentary trusts, trusts created by trust deeds and court orders including the management of the legal and financial affairs of aged and infirm persons.
What is a Trustee?
A trustee is a person or corporate entity that takes responsibility for various assets and manages them for another person. The trustee of a court-appointed trust holds a Court Order outlining the terms and conditions of the trust.
Who is a Beneficiary?
A beneficiary is a person who is entitled to the assets held in trust. By law, the assets can only be spent in the best interests of the beneficiary.
What is a Guardian?
A legal guardian is generally appointed by the Courts or in the case of a child, nominated in a Will. The guardian is responsible for ‘lifestyle’ decisions, such as where a person should live, whether a person should undergo a medical procedure, where a child should be educated and other everyday matters. A trustee will rely on the recommendations of a legally appointed guardian when considering requests for expenditure.
What about Parents?
In the absence of a legally appointed guardian, the trustee will consult with parents and/or family members, when making decisions about expenditure, investments and other matters relating to the beneficiary’s interests.
Who is Responsible for the Trust?
The trustee is ultimately responsible for all funds spent from the trust. Although a parent, guardian or close family member may recommend an expenditure, the trustee is still responsible – by law – and may have to prove to a court that the payment was in the best interests of the beneficiary.
Why do Trustees Require a Substantiation of Expenses?
All trustees, including the Public Trustee, normally require evidence of expenditure. This can be in the form of invoices, receipts, loan documents, etc, to justify financial transactions. Unfortunately a trustee cannot just accept the word of a client or family member and this is sometimes difficult to accept. After all, it is often a family member who looks after and cares for a beneficiary. A trustee however, has a responsibility to account to auditors and to fully document each decision, in the event that the decision is challenged in Court.
Who does a Trustee Report to?
Trustees, including the Public Trustee, are subject to the Trustee Act. A trustee is also responsible to the Supreme Court and may need to apply to the Court for permission to do certain things. The Supreme Court has the power to appoint a trustee and at any time may change the appointment of a trustee. The Public Trustee has the additional responsibility of reporting to Government through the Department of Justice and the Attorney General. The Public Trustee is also subject to the scrutiny of both internal and external auditors, as well as the Ombudsman, who has the power to investigate all matters and report all adverse findings to Parliament.
About the Public Trustee
The Office of the Public Trustee forms a part of the Northern Territory Department of Justice. Our services include drafting Wills and Enduring Power of Attorney documents, administering deceased estates and managing trust accounts. Our aim is to provide a community service which is totally independent, effective and thoroughly professional. As a trustee organisation, the Public Trustee for the Northern Territory can assure you of impartiality, affordability, efficiency, experience and accountability.
The Role of the Public Trustee?
The role of manager covers all financial matters (unless otherwise limited) and some legal matters, in relation to property affecting the beneficiary. This may include:
- Collecting income such as pension entitlements, superannuation, rents, investments, dividends from shares and interest.
- Lodging social security and medical benefits forms.
- Arranging payment of accounts such as accommodation, personal expenses, rates, property repairs, gas, electricity, medical, hospital and nursing home charges.
- Preparing and lodging taxation returns.
- Maintaining accurate accounts and providing statements to guardians on an annual basis or more regularly if required
What legislation is applicable?