I am the trustee of an ACIS deed Discretionary Trust I also have a partner who is the principal. On a couple of occasions over the past 10 months he (my partner) has threatened me with removing me as trustee over personal issues and also to sell the properties we have in the trust for way under their market value. Where do I stand as all of these properties (we have 4 and one in my personal name) were all acquired through bank loans in my name as trustee for, not his or the trust, what would happen in this case. I have been advised to do these things by him as he has had experience in these matters so he understands the way they all work, hence the trust set up to perhaps end up to an advantage point. And perhaps I’m too trusting or gullible. I have just noticed today that with our company that I am director of has got my signiture with (my name) as trustee for the trust we have. Does this mean if he sacks me I am also removed as the director of this company???
I have since the last threat read through the explanatory memorandum and realised that as the roll of the principal he can do this with no questions asked.
If you could please assist me as soon as possible as I am very concerned as to where my future lies with this person in control, and I am very confused as I have asked him to either do it or dont, not just to hold the threat over my head like a carrot. I have 2 children (not his) with whom I am to travel with after Christmas to the north of the country to either renovate one of the 4 properties or to Darwin to get on with my life and start again. I don’t wish to renovate the property in fear I complete the project and then he decides to sack me and all the hard work and time has been for nothing. At the moment I am living in one of the properties and renovating it and have the same feeling but I don’t like to leave things unfinished plus I need to wait for the kids to finish their term at school before heading off, so I will keep plugging away.
If you can help me with any of these answers would sure help me towards some form of direction.
thank you for your timethanx for your time
Okay there are a few factors heres at play.
The first factor is what is written on the deed of the trust. If he is the appointer then he can hire or fire the trustee (this can be over ruled though). The trustee runs the trust on behalf of the beneficaries. So could this person fire you – if he was the appointer of the trust, yes.
But if you were in a relationship with this indvidual (say defacto or marriage) it goes to the Family Court. The Family Court has the power to do basically anything. They can stop you leaving the country, they can declare sales invalid and did not happen and reverse them, they can freeze assets and bank accounts. They can also send people to jail. They also have complete power over trusts and companies, and they can rip them apart with ease (as if they never existed). Have a quick look here: http://propertyinvesting.com/forum/topic/19604
The other way is to go to the supreme court. You will need to get a damn good lawyer and they will have to advise you. Here its a grey area and as such I can’t really comment.
As for structure, usally the company is the trustee of the trust (so the company runs the trust).
If you are a director of the company, shareholders vote you in or out. Bt pls. remember that the company is only the trustee NOT the appointer (who is the person who actually can fire or hire the trustee).As such if you hold equal shares one can’t vote you out. But if all the assets are owned by the trust the company won’t be worth much.
One solution to your problem would be to renovate the house then remortgage it. Use the higher mortgage amount as payment for your services as the trustee (kind of like a service fee) or as income for you managing the propertty renos. As a side note I would always want to be holding a good amount of $$$ and remember possesion is 9/10ths the law.
Of course you should speak to a good lawyer about this (as well as how to structure it – you might need to see two lawyers – family court lawyer and company/trust/structuring lawyer).
Hellman
hi amazon196969
I agree with hellman the only thing I would add is that you must try to keep this out of the courts for both of you the only wins are the eagles and you both lose. talk to a eagle for companies and trusts as it would be easier to separate the properties into two separate trusts without major costs.
Think of this problem as a business deal and in that way its all about profit and loss
reduce you losses to both and if he thinks he will gain anything by going to court post who’s been to the family court and give him some of those horror stories and he will change his mind.
good luck not been there myself but I know alot who have and work out the best offer for you and negotiate a deal.
I would put lends on all properties so you have cash flow don’t steal it but put it in a safe place should it go legal as you will need alot of money.
This is not advice just help
sorry about any mistypes as i’m in a hurry for ameetinghere to help
Thank you both for the information given, greatly appreciated and will follow it up with legal advise.
thanks heaps
Kyliethanx for your time
Maybe try to get the appointor changed to be both of you (don,t know if this would be possible)
Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe†in subject line.Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
The Appointor can be changed by executing a Deed
of Amendment. The Deed must be executed by the Trustee and Principal of the Trust.CATA
Asset Protection Specialist
[email protected]
You must be logged in to reply to this topic. If you don't have an account, you can register here.
