Powers of appointment and discretionary trusts

Robert Pearce and Warren Barr

in Pearce & Stevens' Trusts and Equitable Obligations

Sixth edition

Published on behalf of © Robert Pearce, John Stevens, and Warren Barr 2015

Published in print December 2014 | ISBN: 9780199644452
Published online June 2015 | e-ISBN: 9780191784576 | DOI:
Powers of appointment and discretionary trusts

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Powers of appointment are one of the key distributive mechanisms offered by equity, and enable a person who is not the owner of property to identify who will benefit from it. A discretionary trust is an equitable mechanism that facilitates the management and allocation of property. However, unlike a power of appointment, a trustee must make a distribution to the identified class, and the court will step in to compel the exercise of a discretionary trust. This chapter discusses both concepts. It includes the nature of powers of appointment; the validity of powers of appointment; the exercise of powers of appointment; duties of the donee of a mere power of appointment; failure to exercise the power; fiduciary powers; and the release of powers; the essential validity of discretionary trusts; the rights of beneficiaries of discretionary trusts; and the duties of trustees of discretionary trusts.

Keywords: equity; powers of appointment; trustees; donee; fiduciary powers; discretionary trust; equitable mechanism; property allocation

Chapter.  21911 words.  Illustrated.

Subjects: Trusts Law

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