However, given that most clients have a chain of deeds, Mr Jackson said it is also important to be aware that if there is a break in that chain of deeds, this will cause dramas for the binding nomination.

“When we are making a valid binding nomination, we're usually looking at the deed that we have in place at the time or the last deed. What we need to figure out for most of our clients is whether that last deed is actually binding?” he said in a recent CGW Lawyers webinar.

Mr Jackson said after going through the process of checking every deed in the chain, in his experience it is very rare that the last deed will actually be binding without any hiccups.

“There are usually a number of deeds and little tiny issues throughout the history that cause problems. It could be simple things like the name of the fund being changed through deed to deed. Sometimes it has a 'the' and sometimes it doesn't, sometimes it has a Pty Ltd, there's lots of random things [like that],” he explained.

“Sometimes there are deeds that don’t comply with the proper variation powers or they list incorrect trust deeds, and therefore we have this link in the chain that is broken, which means our last deed is actually invalid.”

In some cases the problems with the deed are so significant, said Mr Jackson, that the client is better off just rolling the money out and starting a completely new fund.

“There is also another middle option but most people don’t like it. If the deed problems are that great, you can go to the court as a trustee and ask for them to give you advice and the court is very good at doing but it does cost quite a lot of money,” he noted.

“[Otherwise] you’ve got the option of paying some early capital gains tax and moving on. For most clients, the moving on option seems to be more palatable, because it gives them a brand new start and they don't have to go through all the dramas of going to court because it takes a long time and costs a lot of money.”

Where there is a dispute regarding the validity of a document, Mr Jackson warned that proving which document is the right one can add significant cost and time to a case.