Introduction

Transfer of trusteeship often raises challenging issues for trustees. This paper explores the approach taken by courts in Bermuda and other jurisdictions in connection with the following issues and questions:

The consequences and remedies when a trustee’s appointment is invalid

Is the power to appoint trustees always a fiduciary power?

Improper exercise of the power to remove and appoint trustees

The tension between the outgoing trustee’s duty to transfer trust property and records verses its entitlement to security for its fees and liabilities.

When outgoing trustees may have personal liability for liabilities that exceed the value of the trust fund

The discussion paper uses a case study as a basis for exploration of the issues and to limit the scope of the paper. However, the intention is that, if need be, each part and section of the discussion paper may be referred to without having considered the case study in detail. Lists of cases with brief summaries, sections of legislation referred to and texts are provided at the end of the paper.

This is a rapidly developing area of the law and many cases turn on specific facts and differing judicial views. Accordingly, in each case, it is prudent to consider the specific facts and issues carefully and obtain advice as appropriate.

Type

Insight

Locations

Bermuda

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