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Trusts & Divorce Solicitors

Divorce is a difficult time for the couple involved, but professionally it can also be a demanding time for the trustees of trusts that hold assets that are at risk of being taken into account indirectly and, in certain circumstances, attacked directly, as a result of the divorce and financial remedy process.

Click to view our A Trustee’s Guide to Divorce: An essential guide for trustees seeking to future-proof against or navigate through divorce.

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The English and Welsh Courts have wide powers to order the variation of any settlement that has a ‘nuptial’ element.  Even if a settlement does not have a ‘nuptial’ element, the English Court can still take it into account as a ‘resource’ where one of the divorcing parties has an interest in it.

If you are a trustee of a trust where either the Settlor or one of the Beneficiaries is involved in a divorce and the resulting financial remedy process you may need to take specialist independent advice. There will be important issues of disclosure and confidentiality to consider: you will need to consider what is in the best interests of all the beneficiaries, not just the one who is getting divorced.

At an early stage, offshore trustees will need to consider whether or not to submit to the jurisdiction of the English courts or whether to avail themselves of local ‘firewall’ legislation to help to protect the trust. What should trustees do when joined to English financial remedy proceedings? If you are an offshore trustee, you should take advice both locally and in England.

However, advising offshore trustees on protecting the trust assets from attack should not start when a beneficiary is getting divorced: it should start before the beneficiary is even married with a review of the way in which the trust is drafted.

  • Should the trust language be modified so as to strengthen the trustees’ hand in the event of a divorce?
  • Can the beneficiaries be encouraged to enter into pre-nuptial or post-nuptial agreements under the terms of the trust?
  • If the trust is particularly large, should it be segregated so as to protect some of the assets?
  • Has sufficient thought been given to the drafting of any Letters of wishes?

Our private client and family law specialists are well placed to advise both professional and lay trustees, onshore and offshore, on their duties and responsibilities.

Payne Hicks Beach is ranked in Chambers HNW 2023. Testimonials include, “Payne Hicks Beach are an excellent specialist firm who provide a very high standard of advice and service.” “The firm displays strength throughout their team with strong partners complemented by a team of equally strong associates.” “Payne Hicks Beach have a real depth of knowledge in this field and are also tough and strategic in litigation.” “They are uniformly first rate, from the technical ability of more junior team members with day to day responsibility on a case, to the deep experience and strategic thinking offered by the partners and more senior associates.” “PHB are absolutely excellent. They are all extremely competent, and can handle really big cases without being fazed by anything.” “I could not be more confident in their ability to handle both complex and sophisticated issue both professionally, successfully, and efficiently.” Another source comments “Payne Hicks Beach have consistently demonstrated their ability to handle complex matters.” With rankings over many years in Chambers HNW, testimonials include “They’re as good as you’ll find; they’re a class act,” says one source, explaining: “They have a lot of depth to their practice. They all have great experience and are very good to deal with.”  Another comments: “They are a fantastic group of lawyers.  They provide excellent advice to clients, and they have strong expertise in a range of areas.  They really invest in their clients; it’s a real pleasure dealing with them.” Quotes commending the private client team include, “They’re always very efficient, they give good advice and they are easy to deal with…their advice is clear, objective and understandable.” A source says, “You can tell that they care about their clients by looking at the quality of their work product…they take the time to address all questions to make sure everyone at the table understands what is going on. They go above and beyond. They’re a fantastic firm.” 

To learn more about divorce and separation visit our dedicated webpage and download our guide.