Halifax ignored my sister’s role as trustee

J.S. writes: When my sister’s partner passed away, we discovered she was the sole trustee of a family trust fund he set up in 2008. Halifax confirmed she was also the only beneficiary of more than £160,000. Later, this was found not to be so, as Halifax said the trust deed could not be found and the beneficiaries could not now be confirmed. The solicitor acting for the estate proposed that the partner’s two adult children would be the natural beneficiaries, and although my sister has signed nothing and agreed to nothing, Halifax has terminated the trust plan. LOOKING into what you told me was like watching an old black and white movie involving a pot of gold, a missing document, and disputed beneficiaries. The pot of gold was held by Halifax Financial Services, and officials there have not denied that your sister was the sole trustee.

However, after apparently telling you that she was also the beneficiary, Halifax then revealed that the trust deed itself could not be found, so there was uncertainty as to who your sister’s partner intended to benefit.

Halifax traced correspondence from 2008 in which it recommended how the trust should operate, with the settlor’s two adult children as beneficiaries on his death. What is missing, of course, is his signature approving this.

Your sister refused to sign anything that reduced her rights as sole trustee. Nevertheless, without informing her, Halifax accepted legal advice and paid out all the funds to the two adult children.

I admit I am surprised that Halifax took this decision unilaterally. On the other hand, I have to accept that if the matter had gone to court, the result would probably have been the same but with big legal costs.

Halifax has told me it wants to apologise for failing to tell your sister what it was doing, and I believe it has sent her £300 by way of saying sorry.