Mr. Michael McDowell, T.D., Minister for Justice, Equality and Law Reform today announced that the Government had approved his proposals for legislation to provide for the variation of trusts.
Commenting on the Government's decision, the Minister said "There is a lack of flexibility in current trust law which, in certain cases, may frustrate trustees in their attempts to meet the legitimate needs of trust beneficiaries. The proposed legislation, which takes account of recommendations of the Law Reform Commission, will remedy this situation by permitting the variation of a trust in certain circumstances for the benefit of the trust's beneficiaries, e.g. by allowing sale of a property and use of the proceeds to provide more suitable accommodation for elderly beneficiaries."
The Minister went on to say: "The new provisions will also facilitate the implementation of Part 3 of the Land and Conveyancing Law Reform Bill 2006 which abolishes various ancient rules which were developed to restrict ownership of property far into the future. The Law Reform Commission has recommended that the abolition of those rules should be accompanied by the enactment of variation of trusts legislation."
The proposed legislation will also permit the variation of pension and charitable trusts. However, the variation of a trust will be prohibited where the application is motivated by a wish to avoid or reduce tax liabilities.
Drafting of the new legislation new legislative provisions will now commence and the Minister expects to introduce it as a Committee Stage amendment to the Civil Law (Miscellaneous Provisions) Bill 2006 which is currently before the Dáil.
22 August 2006