SQE Trusts

The SQE Trusts assessment evaluates a your ability to apply key legal principles and rules governing trusts, focusing on practical and ethical problems that arise in a solicitor's practice. The test assesses the level of competence expected from a newly qualified solicitor when advising on trusts and handling related legal matters.

You must demonstrate an understanding of the creation and operation of express trusts, which are explicitly established by a settlor, as well as implied trusts, which arise from circumstances or conduct. You are required to explain the formalities required for creating a valid trust, the distinctions between different types of trusts (e.g. discretionary, bare, and charitable trusts), and how trusts operate under English law.

The assessment covers the fiduciary nature of the relationship between trustees and beneficiaries. You must understand the obligations of trustees to act in the best interests of beneficiaries and to avoid conflicts of interest. You must be able to advise on the legal consequences of breaching fiduciary duties and understand how the law protects beneficiaries from potential misconduct by trustees.

You are tested on their knowledge of the duties and powers of trustees under trust law. This includes understanding the statutory and common law obligations imposed on trustees, such as the duty to invest trust property prudently, act impartially between beneficiaries, and account for their actions. You must also know the limits of trustees' powers, such as their power to distribute assets or alter trust terms, and the liability trustees face if they breach their duties.

You must demonstrate a thorough understanding of the equitable remedies available in trust law. This includes remedies like injunctions, specific performance, and the imposition of constructive trusts or tracing claims to recover misappropriated trust property. You must be able to advise clients on the appropriate remedy in cases of trust disputes or breaches of trust.

Throughout the assessment, you are required to act with honesty and integrity, in line with the Statement of Solicitor Competence, the SRA Principles, and the Code of Conduct. Ethical decision-making plays a key role, particularly in handling trust matters that affect beneficiaries' rights or involve fiduciary breaches.

You will not be tested on foreign assets, foreign law, or foreign taxes, focusing solely on trust law applicable in England and Wales. Questions may draw from any combination of the topics, requiring you to apply your knowledge to complex, client-based scenarios encountered in practice.
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