Knowledge

Introduction

In the recent case of In the matter of the representation of Z as Trustee of The A Family Settlement [2025] JRC 062, the Royal Court of Jersey has refined its approach to applications where trustees seek approval for decisions regarding litigation. Trustees often seek the court's blessing before initiating, continuing, or discontinuing legal proceedings (traditionally known as a "Beddoe application").

This decision builds on previous case law, including The F Charitable Trust [2017] (2) JLR 26, which suggested the court might take a more direct inquisitorial approach in evaluating such applications, and "be ready to form its own judgment" on the merits of litigation, given the familiarity of the court with litigation generally. While that decision indicated that the court might substitute its own judgment on whether litigation was appropriate, the latest decision confirms that the court’s role remains supervisory. It may scrutinise a trustee’s reasoning more closely, but will not routinely substitute its own judgment for that of the trustee.

The case in question addressed how the court should approach a trustee’s decision concerning legal proceedings, specifically whether to discontinue litigation. The key issue was whether the court should substitute its own judgment or limit itself to ensuring (in the usual way on a blessing application) that the trustee’s decision was made properly.

The court's supervisory role and the non-intervention principle

A key takeaway is that even in a Beddoe context, the court does not take over a trustee’s role. The court still applies the usual test on a blessing application, asking whether:

• a trustee's decision was made in good faith;
• the decision is rational and one a reasonable trustee could make;
• there is no conflict of interest affecting the decision; and
• a trustee has taken into account all relevant factors and disregarded irrelevant ones.

The court emphasised (as in The F Charitable Trust) that where a trustee’s decision relates to litigation, the court will often have greater expertise than the trustee itself. Unlike other trustee decisions, such as investment strategies or family-related distributions, the court is inherently familiar with litigation risks and costs. This means litigation-related decisions will be subject to heightened scrutiny, but the court’s role remains supervisory rather than directive – so long as a trustee's decision is within the reasonable range of decisions, and passes the other tests above, it will be blessed.

This aligns with the long-standing non-intervention principle, which establishes that the court's function is not to replace a trustee’s discretion but to ensure decisions meet certain standards. The court will not substitute its own view unless a trustee's decision is clearly flawed due to irrationality, bad faith, conflict of interest, or a failure to consider relevant factors.

Practical implications for trustees

Trustees considering litigation should take note of the court’s evolving approach:

• if a trustee follows proper legal advice, there must be strong reasons for the court not to bless the decision;
• trustees must carefully document their rationale and legal opinions when making litigation decisions to withstand court scrutiny; and
• trustees should ensure that all relevant considerations, including financial, legal, and practical risks, are properly evaluated.

Conclusion

The court’s latest decision provides greater clarity for trustees managing litigation. While the court will closely scrutinise litigation decisions on a blessing application, it is clear that the ultimate decision rests with the trustee, provided it is made rationally, in good faith, without conflict of interest, and with due consideration of all relevant factors. This clarification should reduce the risk of trustees following all the right processes, only to find that the court simply takes a different view from that of a trustee's lawyers.

If you would like any further information, please get in touch with your usual Bedell Cristin contact or one of the contacts listed.