The renowned physicist, Professor Stephen Hawking, when considering time travel, has mused that, “…we have not yet been overrun by tourists from the future..” In the English law of trusts, the decision of the Supreme Court in Pitt v Holt, Futter v Futter, has resulted in turning back the ‘fiduciary clock’ by judicial order, which is rather problematic and unattractive. Going forward, trustee tourists from the future seem certain to be a rarity in English law. In several international financial centres, however, what the common law has taken away, the legislature has given back. This case note will examine the first decision of the Supreme Court of Bermuda on section47A of the Trustee Act 1975. This statutory provision has sought to replicate in Bermuda law the so-called rule in Re Hastings-Bass as it was understood in England and Wales before the English Court of Appeal decision in Pitt v Holt in 2011.

In the Court of Appeal in Pitt v Holt, Futter v Futter, Longmore LJ noted that the appeals in those cases: provide examples of that comparatively rare instance of the law taking a serious wrong turn, of that wrong turn being not infrequently acted on over a 20-year period but this court being able to reverse that error and put the law back on the right course.

The ‘wrong turn’ that Longmore LJ was talking about was the principle established in a succession of English cases and known as the ‘rule in Re Hastings-Bass’. Confusingly, the ‘rule’ had not, in fact, been established in Re Hastings-Bass at all, but rather in a line of cases starting with Mettoy Pension Trustees Ltd v Evans. The ‘rule’ held that the exercise of a discretionary dispositive power by trustees may be declared void and set-aside by the court (even many years after the event) on the basis that the trustees had failed to take into account relevant matters when exercising the power. This ‘rule’ has over the years proved to be particularly useful in a number of cases when, on the application of the trustees, the court had been persuaded to set-aside prior acts of the trustee on the basis of their own failure to take into account a relevant tax consequence of their actions.

Type

Insight

Locations

Bermuda

Share
Twitter LinkedIn Email Save as PDF
More Publications
5 Dec 2022

Business Crime and Investigations in Bermuda: Overview

A Q&A guide to business crime and investigations in Bermuda.

24 Nov 2022

Information Technology, Outsourcing, Privacy & Data Protection

All aspects of Bermuda's economy rely on information technology and data processing - an essential i...

Contributors: Duncan Card
22 Nov 2022

A Look Back on 2022 and What to Expect for 2023

As we approach the end of 2022, we are able to look back and say with certainty that the arena of la...

14 Nov 2022

When will the court enforce a promise?

As we all know, promises are made and broken all the time. What, if anything, can the law do to assi...

4 Nov 2022

Legally speaking: what not to do when outsourcing operations

In the course of my career, I have drafted, negotiated or otherwise provided commercial and legal ad...

1 Nov 2022

The Insolvency Review – Edition 10

The Insolvency Review offers an in-depth review of the most consequential features of the insolvenc...

25 Oct 2022

Bermuda: Mergers & Acquisitions Comparative Guide 2022

This country-specific Q&A provides an overview to Mergers & Acquisitions laws and regulati...

Contributors: Katie Blundy
24 Oct 2022

Directors’ duties on the eve of insolvency

It is common knowledge that directors of companies owe a duty to the company to act in its best inte...

Contributors: James Batten
13 Oct 2022

Employee probation periods: an update

The Employment Act 2000 is the island’s key piece of employment legislation, applicable to employe...

Contributors: Kiara Wilkinson
6 Oct 2022

Centre Stage: Bermuda’s Role In An Insurtech Revolution

Bermuda is rapidly becoming a focus for insurtechs seeking the island’s expertise, the accessibili...