Trust query and rights of a trustee

[Perkisc]

My father owns a property and is looking to sell it. He owns 50%, and the remaining 50% is held in a trust that was created when my mother passed away five years ago. His granddaughter wants to buy the house, but her offer is well below market value. I am both a trustee and a beneficiary of the trust that holds the other 50%. Do I have the legal right to prevent the sale?

[PallasAthena]

To sell a property needs the agreement of all the registered legal owners at the Land Registry so if that's the case the trustees would have to agree before it could be sold.

There is nothing to stop property owners selling below market value but there might be Capital Gains Tax implications if you do. HMRC calculate CGT on the actual open market value at date of sale even if the property is sold under value.

[Frank1]

Much depends on the type of trust and the terms of the trust deed.
In a bare trust the beneficiaries can instruct trustees to sell the property.
In a discretionary trust, trustees have the discretion to sell without beneficiary consent.
For a life interest trust, the tenant's consent is usually required.

[Frank1]

It wouldn't surprise me if there is a clause in the trust deed stating if your father as co-owner wishes to sell the property, trustees agreement to the sale shall not be unreasonably withheld.

[Frank1]

Copilot drafted the following example of a life interest trust in seconds:

Gift of Life Interest in My Share of the Property

I give all my legal and beneficial interest in my share of the property known as [full address] ("the Property") to my Trustees upon trust as follows:

1. Life Interest for My Spouse

My Trustees shall hold my share of the Property for the benefit of my spouse [spouse's full name] who shall have the right to occupy the Property for their lifetime, rent free, and to enjoy any income from my share.

2. Powers of Trustees

My Trustees may, with consent of my spouse, sell the Property and use the proceeds to purchase another property for my spouse to occupy on the same terms, or to invest the proceeds and pay the income to my spouse during their lifetime.

3 Remainder to Beneficiaries

Upon the death of my spouse, my Trustees shall transfer my share of the Property (or the proceeds of sale) to [names(s) of Beneficiaries] in equal shares absolutely.

4. Protection of Life Tenant

My spouse shall not be required to give security for the performance of their obligations under this trust and shall not be liable for fair wear and tear to the Property

Copilot then asked me if I wanted a more detailed version that could include maintenance costs, remarriage or moving house.