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In re Manisty’s Settlement: ChD 1974

The court contrasted the exercise by trustees of an intermediate power with the exercise of a wide special power.
Held: A wide power, whether special or intermediate, does not negative or prohibit a sensible approach by trustees to the consideration and exercise of their powers. An intermediate power break the normal principles because, in relation to a power exercisable by the trustees at their absolute discretion, the only ‘control’ exercisable by the court is the removal of the trustees, and the only ‘due administration’ which can be ‘directed’ is an order requiring the trustees to consider the exercise of the power, and in particular a request from a person within the ambit of the power.
Templeman J said: ‘The Court cannot insist on any particular consideration being given by the trustees to the exercise of the power. If a settlor creates a power exercisable in favour of … his relations … the trustees may for many years hold regular meetings, study the terms of the power and the other provisions of the settlement, examine the accounts and either decide not to exercise the power or to exercise it only in favour, for example, of the children of the settlor.
In my judgment it cannot be said that the trustees in those circumstances have committed a breach of trust and that they ought to have advertised the power or looked beyond the persons who are most likely to be the objects of the bounty of the settlor. The trustees are, of course, at liberty to make further inquiries but cannot be compelled to do so at the behest of any beneficiary. The court cannot judge the adequacy of the consideration given by the trustees to the exercise of the power, and cannot insist on the trustees applying a particular principle or any principle in reaching a decision.
If a person within the ambit of the power is aware of its existence he can require the trustees to consider exercising the power and in particular to consider a request on his part for the power to be exercised in his favour. The trustees must consider this request, and if they decline to do so or can be proved to have omitted to do so, then the aggrieved person may apply to the court which may remove the trustees and appoint others in their place. This, as I understand it, is the only right and only remedy of any object of the power.’
Templeman J
[1974] Ch 17, [1973] 3 WLR 341, [1973] 2 All ER 1203
England and Wales
Cited by:
CitedVadim Schmidt v Rosewood Trust Limited PC 27-Mar-2003
PC (Isle of Man) The petitioner sought disclosure of trust documents, as a beneficiary. Disclosure had been refused as he had not been a named beneficiary.
Held: Times had moved on, and trust documents had . .

Lists of cited by and citing cases may be incomplete.
Updated: 08 October 2021; Ref: scu.180359 br>

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