You must be intimated in advance for any meeting
resolution passed is unsustainable
you are chairman for lifetime
Private trust dispute
Dear Sir / Madam, We are total 5 members in the Trust, my wife and I are two in total 5 members. I'm the Chairman of the Trust, and my office is Lifetime written in Bylaws. Following are 4 important bylaws written in the TrustDeed to protect the interest of each and every member. 1) Chairman office is for Lifetime 2) Minimum quorum of 3 members required and must be physically present to pass any resolution. 3) Anonymous acceptance is a must for any resolution to pass. 4) Chairman (That's basically me) is Authorized signatory to open bank accounts and sign on checks. Now the question is: Can other 3 members conduct a meeting without informing me and my wife pass a resolution to change my role (Chairman)? other 3 belong to one family and they are basically trying to take control on the Bank account. Your advise is greatly appreciated. Thank you.
Asked 4 years ago in Civil Law
First answer received in 30 minutes.
Lawyers are available now to answer your questions.
8 Answers
Without reading the whole trust deed its difficult to advise.
Technically majority decision can be passed against chairman.
Dear Barman / Thanks for the response. You said Majority decision can be passed against the Chairman. Then what’s purpose of having the requirement of anonymous voting to pass any resolution? What is the meaning of “Chairman’s office is for lifetime?” I agree with Mr Ajay’s response, They must intimate me and my wife for any meeting in advance.
Asked 4 years ago
Since no intimation was given for meeting resolution passed would not withstand legal scrutiny
Dear Querist
if there is any condition in the bylaws then only the majority can change the chairmen and not otherwise, as per your information, you can not be changed at any point of time, even they are bound to inform you for any meeting.
Dear Sir,
No, the other 3 members cannot conduct a meeting without informing you and your wife and change your role, from anything apart from a chairman; simply because of 3 things.
1. Your office is for lifetime and you may not be removed ARBITRARILY ACCORDING TO THEIR DISCRETION
2. Informing you of the meeting is mandatory as you serve as the chairman. Conducting secret meetings without your knowledge is bad in law
3. Based on 4th bye-law, only you can take control of the bank account, and breach of this law leads to breach of contract.
Thank you
God Bless
The other members can no doubt pass a resolution as per the bylaws, but they cannot oust you from the post of Chairman as the bylaws do not permit this situation.
A Private Trust is mainly created for the benefit of one or more than one person and is governed and regulated by Indian Trusts Act, 1882.
Trust property can't be sold without court's permission.
The trustee has the onus to take reasonable measures to ensure that the trust corpus achieves sustainable returns and, at the very least, does not diminish in value.
However if at all the other members are desirous of conducting a meeting they have to inform all the trustees about the meeting in writing and get a confirmation/acknowledgment for this intimation about the proposed meeting.
Decision-making can be made unanimously or by majority vote.
Typically, for important decisions concerning monetary/financial matters, unanimous consent of the board of trustees may be taken. Ideally, a trust deed should address procedures for, inter alia, decision-making, conducting meetings and forming committees.
A lifetime trust can apply to any trust you create and will last for the lifetime of the beneficiary or beneficiaries. It can be applied to an irrevocable trust, a revocable living trust or a testamentary trust.
However there is no such term called as life term for the chairman of the trust to be a trustee for his entire lifetime.
It is an arrangement but may not be enforceable based on the trust deed
The question who should be appointed trustee to some extent depends upon the nature of the trusts ,whether it was regarded as a hereditary trust or whether the trusteeship of each holder ends with him
In general, the main duties of trustees are:
# to act in the best interests of the beneficiaries of the trust
# to act in an even-handed manner between beneficiaries and between groups of beneficiaries
# not to use knowledge or influence gained as a result of being a trustee to advance the trustee’s own position (except when the trustee discloses his or her personal interest to the settler of the trust and obtains # the settler’s informed consent)
# to act personally rather than delegating decisions to others (except if the trust document explicitly permits delegation)
# to act honestly and with the level of skill and care that would be expected of the reasonable businessperson in administering the affairs of others
# to be thoroughly familiar with the terms of the trust in the trust deed (the main trust document), and with who the possible beneficiaries may be and what the assets and liabilities of the trust.
- No, without information and notice , members cannot change the role of a chairman or even remove him
- If such happened then it is a violation of Trust Act , and a petition can be filed before the court.
- For for removing the chairman the members will have to pass a resolution in the meeting , and there must be a genuine reason for the removal .
