Property had been placed in trust for the daughter of the family, fearing that she might fritter it away. The trust was managed by the bank. The judge had found that, having misunderstood the powers of advancement given, the bank was liable to repay part of the funds to the trust fund. Both parties appealed.
Held: The doctrine of laches has no application to cases to which the Statutes of Limitation apply either expressly or by analogy.
The court considered the exercise of a power by the trustees: ‘Being a fiduciary power, it seems to us quite clear that the power can be exercised only if it is for the benefit of the child or remoter issue to be advanced or, as was said during argument, it is thought to be ‘a good thing’ for the advanced person to have a share of capital before his or her due time. That this must be so, we think, follows from a consideration of the fact that the parties to a settlement intend the normal trusts to take effect, and that a power of advancement be exercised only if there is some good reason for it. That good reason must be beneficial to the person to be advanced; it cannot be exercised capriciously or with some other benefit in view. The trustees, before exercising the power, have to weigh on the one side the benefit to the proposed advancee, and on the other hand the rights of those who are or may hereafter become interested under the trusts of the settlement.’
Judges:
Willmer, Harman, Upjohn LJJ
Citations:
[1963] EWCA Civ 5, [1964] Ch 303, [1963] 3 All ER 1, [1963] 3 WLR 742
Links:
Jurisdiction:
England and Wales
Citing:
Appeal from – 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 by:
Cited – Green and others v Gaul and Another; In re Loftus deceased ChD 18-Mar-2005
The claimants began an action in January 2003 to seek to set aside the appointment of an administrator from December 1991, and to have set aside transfers of property made within the estate.
Held: The limitation period against a personal . .
See Also – Re Pauling’s Settlement Trusts (No 2) 1-Jun-1963
An application was made for the trustee to be replaced. The trustee complained that he would remain liable in certain events, and sought an indemnity from any new trustee out of the trust fund.
Held: A new trustees would be under ‘the normal . .
Cited – Re Hastings-Bass; Hastings v Inland Revenue CA 14-Mar-1974
Trustees of a settlement had exercised their power of advancement under the section, in order to save estate duty by transferring investments to be held on the trusts of a later settlement. However the actual effect of the advancement was that the . .
Lists of cited by and citing cases may be incomplete.
Equity, Limitation, Trusts
Updated: 23 March 2022; Ref: scu.262803
