Letters of wishes specify what a settlor wishes the trustee to do about particular matters that arise during the trust period. For example, which of the beneficiaries should receive a distribution from the trust assets, when such distribution should be made and how much such distribution should be.
E.g. I want to give my mom 70% and my sister 30% of my trust assets.
Where there is any element of discretion it is important that your trustees know your intentions behind the structure of your trust. They need to know your main aims and how you would like them to look after your assets.
Yes. Settlors can make changes to trust arrangements from time to time with relative ease without having to go through the formalities of amending a trust deed.
It’s not a legal obligation for a trustee to follow the letter of wishes. The trustee, however, has to take into account the letter of wishes when exercising its powers, and the trustee can follow the letter of wishes if it’s in line with the trustee’s duties. Most of the time, trustees will follow the letter of wishes.
According to Hong Kong Law, trustees must apply their minds when exercising their power or discretion, but not act under the instruction of another. To do so is a breach of trust.
