Fiduciary administration

By law, a child’s financial affairs are the responsibility of the parents or guardians until that child attains the age of majority, i.e. eighteen years of age.

On his eighteenth birthday, he gains full control of property and funds of which he is the legal owner, including any inheritance or gift. However, it is not always desirable for young people to be given unfettered access to a significant sum of money, including any inheritance. In certain circumstances it may not be desirable to allow older people to have full control of their assets either, for example because of a gambling addiction or illness. If you intend to leave property or funds to someone in your Will, or by means of a formal gift, you can impose stipulations and restrictions by instituting a ‘fiduciary administration’ (bewind).

You can institute a fiduciary administration in a Will or in the case of a gift. A court can also impose a regime of ‘protective administration’ (beschermingsbewind). In either case, the assets under administration are managed by an administrator. This means that the beneficiary cannot dispose of the assets him or herself.

You can appoint an administrator of your choice in your Will. It might be your partner, a close relative or a professional service provider, for example. If you omit to name an administrator, the Subdistrict Court (kantonrechter) will appoint one. You may also stipulate the period of administration, i.e. the age at which the beneficiary is to be given full access to the assets.

If you institute a fiduciary administration in your Will, you should be aware that it can, in principle, be terminated five years after your death. If there are exceptional circumstances, however, it is possible to stipulate in your Will that the fiduciary administration should continue throughout the beneficiary's life. Your reasons should be clearly stated in your Will so that the court can determine whether they are still applicable should the beneficiary apply for this arrangement to be lifted.

A fiduciary administration can also be instituted for children who are under the age of majority. This may be appropriate if you do not wish to burden the guardian with the responsibility of administration, or because you do not wish the other parent (your ex-spouse) to have access to the assets inherited from you by your minor child.

Please contact us if you need further information about the various aspects of fiduciary administration. We shall be pleased to offer advice.