The Claimants sought an order directing the Defendant to provide a full account of his dealings with the assets of the two trusts as a trustee or as a de facto trustee.
Held: The court has a discretion whether or not to make an order for an account in common form to be produced by a trustee. Although it would not be right to say that there is a presumption in favour of making an order for an account, in my judgment, the court will not decline to make an order lightly where a trustee holds or has held assets for beneficiaries of a trust. An order for accountswas granted in favour of one beneficiary, but declined for another.
The Court noted the nature of accounting by trustees: ‘ They are different to trading accounts for a business entity. In the case of the latter, the accounts, in accordance with accounting conventions, provide a balance sheet which gives a snap shot as to the asset position on a date and a trading report covering a period. Trust accounts, particularly where there are beneficiaries with interests which have not vested, must be able to show from period to period (the frequency of accounts is not fixed) how the trust assets have been dealt with, including what distributions and disposals have taken place. A beneficiary reading trust accounts must be in a position to assess whether the trust assets conform with the trust instrument, that the class of assets held is appropriate for the trust. The style of the accounts, and the level of detail provided will necessarily vary.’
Judges:
Marsh CM
Citations:
[2017] EWHC 225 (Ch)
Links:
Statutes:
Jurisdiction:
England and Wales
Citing:
Cited – Soar v Ashwell CA 1893
Trustees under a will had entrusted the trust fund to a solicitor for investment. The solicitor exercised all of their administrative and investment powers for them and distributed part of the fund invested to the beneficiaries under the will but . .
Cited – Campbell v Gillespie ChD 1900
Certain businesses and property were held on trusts for the benefit of the Claimant’s creditors, with the Defendant the trustee. The estate was re-conveyed to the Plaintiff and the re-conveyance contained a recital that the Plaintiff’s debts had . .
Cited – Armitage v Nurse; etc CA 19-Mar-1997
A clause in a trust deed may validly excuse trustees from personal liability for even gross negligence. The trustee was exempted from liability for loss or damage ‘unless such loss or damage shall be caused by his own actual fraud’.
Held: The . .
Cited – Dubai Aluminium Company Limited v Salaam and Others HL 5-Dec-2002
Partners Liable for Dishonest Act of Solicitor
A solicitor had been alleged to have acted dishonestly, having assisted in a fraudulent breach of trust by drafting certain documents. Contributions to the damages were sought from his partners.
Held: The acts complained of were so close to . .
Cited – Libertarian Investments Ltd v Hall 6-Nov-2013
(Hong Kong) A trustee owes a duty to hold trust funds and apply them for the purposes of the trust (a stewardship or custodial duty). He is bound to answer for his stewardship when called on by the beneficiary to do so. If for any reason he . .
Cited – Re Pauling’s Settlement Trusts ChD 1962
Family money had been placed into a trust to be managed by a bank. It was said that the bank had wrongly advanced money to the daughter allowing her to fritter away large parts of the capital
Held: The bank had misunderstood the power of . .
Cited – Attorney General v Cocke ChD 1988
. .
Cited – Royal National Lifeboat Institution and Others v Headley and Another ChD 28-Jul-2016
Beneficiaries’ right to information from estate
The claimant charities sought payment of interests under the will following the dropping of two life interests. They now requested various documents forming accounts of the estate.
Held: The charities were entitled to some but not to all of . .
Lists of cited by and citing cases may be incomplete.
Trusts, Equity, Limitation
Updated: 31 January 2022; Ref: scu.575349