Knowledge

In the case of In the Matter of the Dunlop Settlement [2013] JRC 123 the Royal Court of Jersey has provided useful guidance as to the costs position of a beneficiary convened to a neutral application relating to the administration of the trust.

A beneficiary who has been convened to a neutral trust application will be entitled to their costs on an indemnity basis provided that they have not acted unreasonably. This case is the latest in a recent line of cases such as Trilogy Management v YT and Others [2012] JCA 204 and Singapore Airlines Ltd and another v Buck Consultants Ltd [2011] EWCA Civ 1542 which assess the distinction between neutral parties to a trust application and those taking an adverse position. Whilst parties who take a neutral position are normally entitled to their costs out of the trust fund, those who adopt an adverse position will be liable for their own costs if they are ultimately unsuccessful at court. The cases mentioned above are helpful in explaining how court may decide such a distinction in practice.

Our briefing provides a general review of the law in Jersey in relation to costs in trust applications. It is well established in Jersey that a neutral trustee is entitled to a reimbursement from the trust fund of their costs or expenses reasonably incurred. This briefing also looks at a beneficiary's right to challenge their trustee's costs and considers how the Jersey court would assess the trustee's costs in the event of such a challenge.

To read more, please see briefing below.

For further information, please contact David Cadin.