79.Where it applies section 22(1) imposes a single duty with three elements on trustees during any agency, nomineeship or custodianship.  First, they must keep under review the terms of the appointment and how the person appointed is performing.  This obligation means that the trustees must keep under review the question of whether the person who has been appointed to act for the trust is a suitable person to do so, and whether the terms on which that person acts are appropriate. In addition, the trustees must keep under review the manner in which the agent, nominee or custodian is performing his or her functions.  The duty to “keep under review” does not oblige trustees to review the arrangements at specific intervals or in a particular way.  The manner in which the duty should be discharged will depend upon what is reasonable in the circumstances.  Second, if circumstances make it appropriate, the trustees must consider whether to exercise any power of intervention (defined in section 22(4)) that they have: for example, to give directions or to revoke the appointment.  Circumstances in which it would be appropriate for trustees to do this may arise, for example, where the agent, nominee or custodian is not carrying out his or her functions effectively, or where the trustees have cause to doubt the suitability of the person in question to continue to act for the trust.  Finally, if the trustees consider that there is a need to exercise a power of intervention, they must do so.
80.Section 22(2) makes specific provision in relation to agents authorised to exercise “asset management functions” (see section 15(5)).  In these cases the duty under section 22(1) includes consideration of whether the current policy statement (see section 15) is being complied with; whether it should be revised or replaced and, if so, to revise or replace it accordingly (section 22(2)).  Any revision or replacement must be in, or evidenced in, writing and must be formulated with a view to ensuring that the functions will be managed in the best interests of the trust (section 15(3) and (4) as applied by section 22(3)).
81.When carrying out their duties under section 22, trustees are subject to the duty of care under section 1 (see Schedule 1, paragraph 3(e)).
Commentary on Sections Part IV: Agents, Nominees and Custodians Section 22: Review of agents, nominees and custodians