TRUSTEES need to be increasingly aware of their responsibilities with regard to insolvent trusts, a local law firm has warned.

Advocate John Greenfield from Carey Olsen said that cases involving insolvent trusts were becoming more frequent in the current financial climate, both in Guernsey and other trust jurisdictions internationally.

He said that trustees needed to be properly prepared for such an outcome and to keep an eye on whether a trust structure held sufficient assets to cover potential liabilities.

‘It is crucial for trustees to understand their rights and duties.

‘There is no clear insolvency legislation in Guernsey that refers specifically to trusts, as there is in the case of a company,’ Advocate Greenfield said.