Role of Trustees

Charity trustees are unpaid volunteers, but nevertheless the law imposes numerous significant legal duties and liabilities on them. They are responsible for the general control and management of the administration of the charity. They also have other specific responsibilities as noted below.

Trustees have certain legal powers to delegate decision-making, but this is a complex area and advice should be taken about it. If something goes wrong, all of the trustees are ultimately responsible and accountable for whatever the charity does, even if they have properly delegated the power to others within the charity to make a decision or to implement it, despite the fact that the trustees are not paid employees but are only volunteers.

A breach of duty or breach of trust by a trustee could give rise to personal liability if the duty breached is to the charity and it suffers loss as a result, but the Charity Commission is only likely to enforce personal liability if the trustee acted dishonestly or recklessly.

A trustee will be personally liable for certain wrongs, for example if the charity is insolvent and the trustee is guilty of wrongful or fraudulent trading or for certain breaches of health & safety, environmental, discrimination, tax, and other laws.

If a charity is unincorporated, a trustee might become personally liable arising out of operational matters, for example, for any breach of contract or negligence by the charity.

Trustees might consider whether the charity should provide and pay for insurance for its trustees to protect them from personal liability but insurance typically has a number of exceptions and limitations, and trustees need to fully understand the extent of these.