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Trustees' Considerations in Providing Financial Assistance: A Case Study

Janina White

20 Oct 2023

The role of a trustee is a significant one, vested with the responsibility of safeguarding and managing assets for beneficiaries. Trustees are often faced with complex decisions, balancing their fiduciary duties with the practical needs and wishes of beneficiaries. J's request, a young individual hoping to turn her life around, offers a quintessential example of the challenges and considerations trustees face.

J's Situation

J, at the age of 20, is burdened with gambling debts amounting to £50,000. Acknowledging the destructive path she's on, J has decided to pursue a law degree as a positive step toward a brighter future. She has approached the trustees, requesting funds to not only clear her gambling debts but also finance her initial year at law school.

Key Considerations

The Legitimacy of Debts:

Before any payment is made, it's vital for trustees to verify the legitimacy of J's claimed debts. Are these gambling debts enforceable? Ensuring that funds aren't wastefully expended is a principal duty of trustees.

Direct Payments to Creditors:

If the debts are found to be legitimate, a direct payment to the creditors might be the best course of action. This ensures the money isn't squandered or rerouted to other potentially harmful ventures.

Alternative Repayment Arrangements:

Immediate repayment isn't always the optimal solution. Engaging in negotiations or arrangements with creditors can sometimes lead to a mutually beneficial agreement. An agreement to pay a fixed monthly amount can be structured, with the trustees making direct payments, ensuring the agreed repayment of the debts.

Real Cost of Law School:

J's request for £10,000 for her first year at law school warrants close scrutiny. For instance, the current Graduate Diploma in Law (GDL) course fee stands at approximately £8,400. Notably, this fee often includes essential resources such as books and library access. Thus, trustees must ascertain the actual costs and ensure the beneficiary isn't overestimating or potentially misusing the funds.

Scholarships and Financial Aid:

Before disbursing funds, trustees should explore available scholarships or financial aid options for J. Numerous opportunities could significantly reduce the financial burden.

Direct Payment of Tuition Fees:

To safeguard the trust's funds and to ensure they're utilized for the intended purpose, trustees can opt to pay J's tuition fees directly to the educational institution.

Additional Support for J:

Given J's history with gambling, the trustees might recommend she attend Gamblers Anonymous or a similar support group. This not only aids her recovery but demonstrates the trustees' holistic approach to their beneficiary's well-being.


J's request is, on the surface, reasonable. Transitioning from a troubled past to a promising future by attending law school is commendable. However, the trustees, given their fiduciary duties, must adopt a judicious approach. This entails verifying claims, considering alternative payment arrangements, and ensuring funds are directly utilized for their intended purpose.

Above all, trustees should exercise prudence, ensuring that while they support J's aspirations, they do not inadvertently facilitate any relapse into destructive behaviors.

Summary (Bullet Points on Trustees' Duties)

  • Verify Legitimacy: Always confirm the authenticity of claims before disbursing funds.

  • Direct Payments: Consider paying creditors directly to ensure funds are used for their intended purpose.

  • Explore Alternative Repayment Methods: Immediate lump sum payments might not always be the best approach.

  • Assess Actual Costs: Ensure that requests for educational fees or similar costs are accurate and justified.

  • Seek Scholarships and Aid: Before releasing funds, explore potential scholarships or financial aid.

  • Pay Institutions Directly: Paying tuition fees directly to schools ensures funds aren't misused.

  • Offer Holistic Support: Beyond financial aid, consider other forms of support for beneficiaries, like counseling or therapy.

Janina is a solicitor registered in England and Wales, and the Republic of Ireland, and a member of the American Bar Association. Her extensive legal expertise spans Corporate Law, Sanctions, and Corporate Governance. Beyond law, Janina is a Chartered Company Secretary and showcases a passion for global cultures, evident in her fluency in eight languages. Advising multinational giants, her unique blend of legal acumen and cultural insight sets her apart, offering readers a rich, global perspective on her subjects. Janina is also a private investigator and a member of the Association of British Investigators and she is actively using the investigative techniques (including the use of the Artificial Intelligence, OSINT and HUMINT)  in her legal work.

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