What is the difference between the interest of a life beneficiary and those of the residual beneficiaries of a trust?
Nova Scotia, Canada
The following excerpt is from Critchley v. Critchley, 2006 NSSC 219 (CanLII):
Often the interest of a life beneficiary differs from that of the residual beneficiaries. That brings into play the so-called “even-handed” rule in Howe v. Lord Dartmouth. The rule requires, when applied to trust investments, a balancing of the investments in such a manner as to provide a reasonable income to the life tenant without impinging upon the entitlement of the residual beneficiaries to share in the capital of the trust on the life tenant’s death.
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