The importance of a Memorandum of Wishes for a trust

The importance of a memorandum of wishes

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What is a Memorandum of Wishes?

  • A memorandum of wishes is a document created by the Settlor of a Trust to provide guidance and suggestions to the Trustees regarding the administration of the trust.

  • While it is not legally binding, it serves as an expression of the settlor's intentions and wishes for how the trust should be managed and for whom the trust assets should be distributed.

  • A memorandum of wishes may include wishes for distributing assets, guidelines for managing the trust, and personal statements or wishes. It can also attach a list of the Settlor’s wishes for the distribution of chattels. 

The importance of a Memorandum of Wishes

  • A memorandum of wishes is not a substitute for a properly drafted trust deed or other legal documents that govern the creation and administration of the trust.

    While a trust deed is legally binding, a memorandum of wishes is not. However, a memorandum of wishes can be a useful tool to provide guidance to the Trustees as they carry out their duties.

  • A memorandum of wishes is an important tool to ensure that the Settlor's wishes are taken into account by the Trustees when administering the Trust.

  • Beneficiaries and Trustees can benefit from the additional guidance and clarity that a memorandum of wishes provides.

Creating & updating a Memorandum of Wishes

  • It is recommended that a memorandum of wishes is created when the trust is established.

  • It should be updated or amended as the Settlor's wishes change over time.

    A memorandum of wishes can be updated or amended, but amendments should be made in writing and signed by the settlor.

  • While a memorandum of wishes cannot be contested in Court, it may be considered by the Court in certain circumstances in determining what the Trust’s objectives are and may influence the Trustees’ decisions.

Disclaimer: This article should not be relied upon for legal advice. Always seek professional legal advice before making any decisions regarding your business.