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The Trusts (Amendment No.6) (Jersey) Law 2013 Briefing | Parslows Trust And Foundation Lawyers Jersey

The Trusts (Amendment No.6) (Jersey) Law 2013 came into force on 25 October 2013 to amend Article 47 of The Trusts (Jersey) Law 1984 so that it now provides a statutory basis for the Royal Court of Jersey to provide discretionary relief to beneficiaries who find themselves materially prejudiced by a trustee’s decision.  The ability to grant relief in these circumstances is commonly known as the Hastings-Bass principle, which has previously been exercised by the Royal Court, with the parameters of the relief having been developed through case law.   

Fault on the part of the fiducary does not have to be shown. The amendment has retrospective effect.

The amended Article 47 sets out 4 situations concerning Jersey Law Trusts, the first two of which concern transfers into trust and the second two concerning the exercise of powers in regard to an existing trust:

Article 47E – Power to set aside a transfer or disposition of property to a trust due to mistake.

Where a transfer or other disposition of property to a trust has been made by a settlor or another person exercising a power, and the settlor or other person made a mistake in relation to the transfer/disposition and would not have made it but for that mistake, and the mistake is so serious to render it is just for the court to make a declaration then the court may declare the transfer or disposition is voidable and has such effect as the court may determine or is of no effect from the time of its exercise.

Article 47F – Power to set aside a transfer or disposition of property to a trust exercised by fiduciary power.

Where a transfer or other disposition of property to a trust has been made by a settlor or through a person exercising a power to transfer or to make other disposition of property to a trust on behalf of the settlor, and that person owes a fiduciary duty in relation to the exercise of that power, but failed to take into account any relevant considerations or took into account irrelevant considerations, and would not have exercised the power, or would not have exercised the power in the way it was exercised but for the failure, then the Court may order that the exercise of the power is voidable and has such effect as the Court may determine or is of no effect from the time of its exercise.

Article 47G – Power to set aside the exercise of powers in relation to a trust or trust property due to mistake.

Where a power has been exercised by a person other than in the capacity of a trustee in relation to a trust or trust property, but the person made a mistake in relation to such exercise of power, and would not have exercised the power, or not in the way in which it was exercised, but for that mistake, and the mistake is of so serious a character to render it just for the court to make a declaration, then the Court may order that the exercise of the power is voidable and has such effect as the Court may determine or is of no effect from the time of its exercise.

Article 47H – Power to set aside the exercise of fiduciary powers in relation to a trust or trust property.

Where a power has been exercised by a person other than in the capacity of a trustee in relation to a trust or trust property and the person owes a fiduciary duty to a beneficiary in relation to the exercise of the power, and failed to take into account any relevant considerations or took into account irrelevant considerations, and would not have exercised the power, or not in the way in which it was exercised, but for such failure, then the Court may order the exercise of power is voidable and that it has such effect as the Court may determine or is of no effect from the time of its exercise.

The above is intended to provide a general overview of the amendment, and specific advice should always be sought in relation to The Trusts (Jersey) Law 1984.

How Parslows can help

Parslows Trust and foundations team provide an exceptional service to all our client whether a beneficiary, trustee, settlor, protector, guardian or council member.

Whether you require a structure for succession purposes, asset protection, tax efficiency, family governance or confidentiality, Parslows Trust and Foundation team members are focused on providing the best and most most appropriate advice for each client.

Our clients are pleased with our service and fees, we are confident you will too.

For further information please do not hesitate to email us at trustlaw@parslowsjersey.com  or call 630530;

The information and opinion expressed in this briefing does not purport to be definitive or comprehensive and are not intended to provide professional advice. For specific advice, please contact Parslows, We are not responsible for, and do not accept any responsibility or liability in connection with, the content of this document or any reliance upon it

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