Moot Skeleton Argument Essay Example | Topics and Well Written Essays - 1000 words

Moot Skeleton Argument - Essay Example The respondent argued that there were significant investment risks due to the financial crisis of 2007 thus limiting investment opportunities. In the second trust was an investment portfolio held in trust by the Barclays Bank for Betty Twix and her mother, Christie. The initial fund was $20,000 that the trustee invested in potato markets. The current value of the investment is $22,000. Betty contested the return on investment arguing that the trustee could have invested in wine markets. According to Betty, the trustee took into account non-financial considerations in choosing not to make such a decision. In such an argument, Betty knew that her grandparents were opposed to alcohol consumption. This was especially important because the bank manager was aware that her grandfather was a man of abstinence. With these arguments, Betty held that the breach resulted to a loss of $1,000. The trustee (respondent) argued that the wine market looked as profitable as the potato market at the tim e of taking that investment decision. The trustee learnt later that the wine markets were performing better than the potatoes market. More importantly, the trustee pointed out a clause that stated that â€Å"the trustee shall not be liable for any loss or damage whatsoever that may occur with respect to the portfolio investment hereby settled unless such a loss or damage shall be cause by trustees own fraud†. In response, Betty Twix argued that the clause was invalid since it was widely drafted and thus could not exclude liability for breach of duties of care or the duty to not to take into account non-financial considerations. In the first instance ruling, Judge McIntyre ruled that the Barclays Bank breached its fist duty of no to have regard to non-financial considerations. Barclays was ordered to pay $1,000 to compensate the loss to the second trust. Skeleton Argument on Behalf of the Defendant (Betty Twix) For trustees to act within the law, they should act within their c lient’s power to invest and select appropriate investments. Before making investment decisions, trustees usually take into account various risk implications. The trustee has the following duties:1 Duty to administer Trust by its terms Duty of skill and care Duty to give notices Duty to account Duty to communicate and furnish information Duty not to neglect Duty of loyalty Duty to avoid conflict of interest Duty of confidentiality The general operating principle in most cases requires the following: i. If governing instrument indicates the need for an action, the trustee may take it f it is fair to the beneficiary, or ii. If an action is lawful, the trustee may take it if the instrument fails to offer sufficient specificity With these facts, it s clear that the Barclays Bank was duty bound to diversify the trust investments on behalf of the beneficiaries. However, the trustee is not a guarantor of the principle and income of the trust but must act in accordance with fiduciary responsibilities. The Barclays Bank did not demonstrate sufficient faithfulness in the performance of its duties, particularly in selecting the potato market over the wine market. The trustee bears personal liability because it took into consideration nonfinancial factors in making such an investment decision.2 Furthermore, the bank acted in mistrust and failed to take into consideration