Trusts Act 2019

Trustees’ powers and indemnities - Powers of trustee - Powers to apply trust property for beneficiary’s welfare

65: Trustee may impose conditions on payment for beneficiary’s welfare

You could also call this:

"A trustee can add rules to money given to help someone, like paying it back or adding interest."

When a trustee decides to use some of the trust's money to help a beneficiary, they can add some conditions to the payment. You might have to pay the money back, or pay interest on it, or give the trustee some security to make sure you pay it back. The trustee can change their mind later and decide not to make you follow the condition, or they can let you off some of the obligations you agreed to.

If the condition is about giving security, the trustee does not have to follow the usual rules about how to invest the trust's money. When the trustee is working out how much money they can use to help the beneficiary, they do not count any money that has been paid back to them. You can compare this to what the law said in the past, for example in s 41A of a previous law.

The trustee has some flexibility when it comes to imposing conditions and managing the trust's money. They can make decisions based on what they think is best for the beneficiary. The law gives the trustee some guidelines to follow when making these decisions.

This text is automatically generated. It might be out of date or be missing some parts. Find out more about how we do this.

This page was last updated on 18 July 2025

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM7382960.

Topics:

Money and consumer rights > Banking and loansHousing and property > Buying and selling homes

64: Trustee’s power to pay or apply capital for beneficiary’s welfare, or

"Trustees can use trust money to help beneficiaries if it's needed for their wellbeing."

66: Trustee not liable for certain losses in relation to amounts paid or applied for beneficiary’s welfare, or

"Trustees are not responsible for losses when using money to help someone, in certain situations."

Part 4Trustees’ powers and indemnities
Powers of trustee: Powers to apply trust property for beneficiary’s welfare

65Trustee may impose conditions on payment for beneficiary’s welfare

A trustee exercising a power to pay or apply an amount of income or capital for the welfare of a beneficiary may impose 1 or more conditions.
A condition may require the repayment of the amount, payment of interest on the amount, or giving security for the amount.
At any time after imposing a condition, the trustee may, either wholly or in part, waive the condition, or release an obligation undertaken or any security given because of the condition.
A trustee, when imposing a condition about giving security, is not affected by any restriction on the investment of trust property, whether imposed under this Act or otherwise.
When working out the amount of income or capital that a trustee who has imposed a condition may pay or apply, an amount repaid to the trustee or recovered by the trustee is taken not to have been paid or applied by the trustee.

Compare

1956 No 61 s 41A