Trusts are supposed to be a protective barrier for family assets. This barrier is under threat from:
- the family law decision in Kennon v Spry (2008)
- the company law decision in Richstar Enterprises Pty Ltd v Carey (2006)
- credit loan accounts and unpaid trust entitlements
- the creation of beneficial interests in the course of estate planning
- bad practices in the administration of trusts.
This paper examines and evaluates each of these threats in practical contexts,including the scope they create for a family trust of another family member to be dragged into matrimonial property disputes, for a trust to be dragged into a beneficiary’s tax dispute and for inheritance claims to turn into trust disputes.