Simon created a family trust, which owns the apartment he lives in.  Years after setting up the trust, he met Stephanie, who he subsequently married.

Simon wanted to leave the apartment to Stephanie in his Will, so made a Will from a Will kit that said his entire estate (including the apartment) would pass to Stephanie.  Unfortunately, Simon was not familiar with the details of trust law and assumed as he was the trustee and beneficiary of his family trust that he ‘owned’ the property and that he could dispose of it in his Will.

This is not the case.  Trust property is dealt with separately to individually owned property.  The trust owned the property, so he couldn’t give it to Stephanie in his Will.  He also had not made Stephanie a beneficiary of the trust, meaning that on the face of it she couldn’t benefit from the trust’s property.

Simon should have:

1. Ensured that when he set up the trust he understood what having a trust meant, and ensured that he ran the trust properly;
2. Updated his trust when he married Stephanie to include her as a beneficiary, if he wanted her to be entitled to trust property; and
3. Taken legal advice about his Will, to check whether what he had proposed in the Will could actually be carried out.

Confusion as to how properties are owned also can arise when selling properties, so it is also important when selling property to know how you own the property.