Hi jimmy2018.

Your partner should have disclosed this to the trustee. She still should even if the funds are no longer available.

The trustee will determine whether the money was due to her creditors under the terms of her trust deed. If it was, they'll look to recover that money over time.

The most likely scenario would probably be an extension of the trust deed to collect what's due via some extra monthly payments.

Hi Jimmy

Honesty is the best policy. I would imagine the trustee would allow this to be repaid over the duration of the trust deed by a third party or allow an extension of payments at the end of the trust deed.

Do not panic or worry- your case administrator will talk your partner through the options.

Hi Jimmy2018,

Your girlfriend won’t be the first or the last person to do something like this and as long as she speaks with the Trustee about it then it should be fine.

As others have said the Trustee may take the view that all or some of the money should have been paid into the Trust Deed and agreed to extend the TD for the repayment of this or reach another repayment agreement.

The best thing she can do is speak with the Trustee and they can clarify it all.

Let us know how she gets on.

Did your girlfiriend have to pay for treatment or have other expenses due to her injury that she had to meet from these funds? If so then her trustee should take these into account too.

I thought the whole point of the trust deed was they monitor all her accounts and transactions as the estate has been given over the TD to administrator so nothing like this happens ?

She did pay for some treatment but it cost about £200 i think.

She will call her TD tomorrow.

It would be impossible for a trustee to monitor someone's accounts and transactions constantly. Instead, there are usually periodic requests for information, maybe six-monthly or at least annually. In between times, your girlfriend has a legal obligation to flag these types of things up.

As already stated, it shouldn't cause a major issue, but may well mean an extension to the term to gather in the extra funds.

Just to echo what Kevin has said, it’s just not possible to monitor someone’s accounts and transactions on a regular basis. Too many clients and too time intensive to consider something like this.

It’s about trust. If someone’s circumstances change they have an obligation to bring this to their Trustees attention.

She has called her TD and now it will all be sorted thanks for all the information.

Would it not be better if the insurance companies checked if someone was bankrupt or in a TD before paying to the person and just paid it directly to the Trustee or is this too complicated to happen ?

Surely there must be some checks in place or way the TD can monitor this to make sure these things do not happen ?

Thanks

Glad that it’s all sorted.

I think in an ideal world then yes, insurers could check the register of insolvencies before making a payout.

I know HMRC will check the ROI before paying a tax refund out and send this directly to the Trustee. Also solicitors will check when it comes to matters that they are dealing with.

It all comes back to trust though and a client understanding their obligations and what they have to notify the Trustee of during their Trust Deed.