What happens when married trustees get divorced?
It is very common practice for a husband and wife to both be trustees of the family trust.
Regrettably it is also very common for married couples to get divorced.
So, how does the divorce affect the trust? And what happens when one or both of them re-marry and have more kids?
These are sticky questions and the answers lie in the trust deed and the Trust Property Control Act.
Firstly, trustees have a fiduciary obligation to act only for the benefit of the beneficiaries. So, the independent professional trustee must make sure that they keep their disputes away from trustees’ meetings and decisions.
Whether all descendants of the couple become beneficiaries of the trust, or only those arising from the two of them together, is a decision that they must make when the trust is formed.
In addition, our trust deed states that if two trustees are married, then no future spouse of either of them may be a trustee.
Ultimately, it is up to the founder to consider the options when the trust is formed.