Tuesday, December 7, 2021

Memorandum of directions – my shot** at the legalese

With the end of year almost here again, it is timely to revisit an estate planning tool often looked at over the festive season, namely the use of letters of wishes or memorandum of directions.

If such a document is to be prepared it should ideally be done so only as part of a comprehensive estate plan.

Generally the following issues should be specifically set out in the document at the time it is signed, namely that:
  1. a last will has been signed;
  2. the memo of directions is intended to provide the trustees with some guidance in the administration of the estate but is in no way intended to change the provisions of the wills;
  3. the trustees should be instructed to take into account that the comments set out in the memo of directions may not be relevant either at the date of death or at any other time in the future. Therefore the trustees should exercise any discretions under the will in the way they believe most appropriate in the circumstances;
  4. to what extent other entities that form part of an overall estate plan (for example, superannuation fund, family trust or company), are to be regulated by the directions;
  5. it is intended to be confidential, and should not be given to anyone other than the trustees and any professional advisers they engage from time to time;
  6. the memo of directions has been completed and is current as at a certain date and that it has been signed.
As usual, please contact me if you would like access to any of the content mentioned in this post.

** For the trainspotters, the title of today's post is riffed from Hamilton and the song ‘My shot’. Listen here: