Where trustees offer as security the deeds of property held by them in trust, the banker should ascertain from the trust deed exactly what powers the trustees possess with regard to charging the property.
If deeds of a trust estate are lodged as security, with a memorandum of deposit, and the banker has no notice of the trust, the equitable interest of the beneficiaries will rank in front of the equitable interest of the banker. But if the banker holds a legal mortgage his claim may take priority to that of the beneficiaries.
If a trustee himself has a beneficial interest in a trust property, his interest is subject to any claim that may arise through a breach of trust.
A bank may act as sole executor under a will, or as trustee under a will or settlement, provided that it has power to do so by its memorandum of association.
By Section 10 of the Trustee Act, 1893 : " (1) Where a trustee, either original or substituted, and whether appointed by a Court or otherwise, is dead, or remains out of the United Kingdom for more than tivelve months, or desires to he discharged from all or any of the trusts or powers reposed in or conferred on him, or refuses or is unfit to act therein, or is incapable of acting therein, then the person or persons nominated for the purpose of appointing new trustees by the instrument, if any, creating the trust, or if there is no such person, or no such person able and willing to act, then the surviving or con tinuing trustees or trustee for the time being, or the personal repre sentatives of the last surviving or continuing trustee, may, by writing, appoint another person or other per sons to be a trustee or trustees in the place of the trustee dead, remaining out of the United Kingdom, desiring to be discharged, refusing, or being unfit or being incapable, as aforesaid.
' (4) The provisions of this Section relative to a trustee who is dead include the case of a person nominated trustee in a will but dying before the testa tor, and those relative to a continu ing trustee include a refusing or retiring trustee, if willing to act in the execution of the provisions of this 'On the appointment of a new trustee, the number of trustees may be increased. (Sec
tion 10, s.s. 2.) Section 17, s.s. 2 and 3, enacts : " (2) A trustee may appoint a banker or solicitor to be his agent to receive and give a discharge for any money payable to the trustee under or by virtue of a policy of assurance, by permitting the banker or solicitor to have the custody of and to pro duce the policy of assurance with a receipt signed by the trustee, and a trustee shall not be chargeable with a breach of trust by reason only of his having made or concurred in making any such appointment.
" (3) Nothing in this Section shall exempt a trustee from any liability which lie would have incurred if this Act had not been passed, in case he permits any such money, valuable consideration, or property to remain in the hands or under the control of the banker or solicitor for a period longer than is reasonably necessary to enable the banker or solicitor (as the case may be) to pay or transfer the same to the trustee." The High Court has power to appoint new trustees whenever it is found inexpedient or impracticable to appoint them without the assistance of the Court. (Section 25.) Where any moneys or securities are de posited with a banker, and the majority of the trustees are desirous of paying or deliver ing the same into Court, but the concurrence of the others cannot be obtained, the Court may order payment or delivery to the majority of the trustees, for the purpose of payment into Court, and the payment and delivery shall take effect as if the same had been made on the authority of all the trus tees. (Section 42, s.s. 3.) (See CUSTODIAN TRUSTEE, DEATH OF TRUSTEE, PUBLIC TRUSTEE, TRUSTEE INVESTMENTS.)