This new definition will cover a myriad of positions as follows:

A director, manager, secretary or other similar officers of a corporation;

A foundation council member;

A general partner or a limited partner participating in management of an incorporated or separate limited partnership;

A partner of a limited liability partnership; and

Any other person purporting to act in a capacity as above.

Reserved Powers by a Settlor – Article 9A

Various minor amendments will clarify and enhance Article 9A. The fundamental amendment is a new Article 9A(3A) confirming that the holding of a reserved power or interest does not of itself constitute the holder a trustee.

Rights of Beneficiaries to Information – Article 29 

Article 29 will be re-worded to remove the double negative language and to clarify that a trust instrument may:

Confer right to request disclosure; or

Determine the extent of the right to information; or

Impose a duty upon a trustee to disclose information to any person.

Hence a trust instrument can restrict the provision of information to beneficiaries. However, such restrictions are not completely prohibitive (i.e. it will be invalid to remove the ability to inspect trust accounts) and any restriction must generally be considered against the principles of accountability to beneficiaries.

There is a continuation of established principles that trustees’ deliberations and reasons are not disclosable, but subject to the terms of the trust and a court order.

Furthermore, a beneficiary, enforcer or another person with leave of the court will retain the ability to apply to the court for further access to information and the court retains an overarching discretion in its supervisory jurisdiction of the trust.

Retention & Accumulation of Income – Article 38

Sub-Articles 38(1) and 38(2) are being rewritten for better clarity as to the accumulation and character of income. In addition, a new sub-article 38(2A) is being introduced so, subject to the terms of the trust, there shall be no time period within which a power to accumulate income and add it to capital, to retain income in its character as income or to distribute income must be exercised.

Trustee Security 

A new Article 43A will exist dealing with a trustee’s entitlement to “reasonable security” upon:

Ceasing to be a trustee; or

Distributing trust property; or

The trust being terminated or revoked.

Article 43A will also cover the rights of third parties (such as a trustee’s officers) to enforce an indemnity despite not being party to the indemnity contract. Hence the existing Article 34(2A) will be repealed.

Ultimately the change Article 43A introduces is to reflect the long-established industry practice of indemnification upon distribution of trust property.

Power of the court to vary a trust – Article 47 

Essentially, Article 47(1) limits the court’s power of variation in the management or administration of the trust to provide consent on behalf of those who cannot consent for themselves (e.g. minors, interdicts and unborns). The court cannot, for example, approve a variation on behalf of an adult beneficiary with legal capacity. Whilst this position is not changing per se, new provisions will provide two practical exceptions to it permitting the court to provide consent to a variation on behalf of beneficiaries who:

The court is satisfied cannot be found, despite reasonable attempts to locate them, and

Due to their number, it is practically unreasonable for such persons to be contacted.

Conclusion

The amendments do not fundamentally change the existing trust law of Jersey, but will look to helpfully clarify certain areas and introduce some new provisions to continue to develop Jersey’s place as a competitive jurisdiction for private wealth administration.

Type

Insight

Locations

Jersey

Share
Twitter LinkedIn Email Save as PDF
More Publications
27 Sep 2022

Similar but Different

While the basic features of the trust remain, there are some notable differences in how trusts can b...

1 Aug 2022

Register of Overseas Entities: A Jersey perspective

The Register of Overseas Entities at Companies House (ROE), as contemplated by the Economic Crime (T...

30 Jun 2022

Digital Identification in Jersey

There have been considerable changes made to the way we do business in recent times. These changes w...

Contributors: Gemma Whale, Paul Worsnop
17 Jun 2022

Proposals to amend the Powers of Attorney (Jersey) Law 1995

Following the recent update from our Guernsey colleagues on the introduction of lasting or enduring ...

Contributors: Gemma Whale
9 Jun 2022

Trustee Knowledge Series: Masters Paper Two: Family Governance

Appleby Private Client & Trust Partner David Dorgan has authored and distributed a series of Tru...

17 May 2022

Navigating the Jersey M&A landscape (3 of 3)

This is the third of a series of three articles, each dealing with topics to be considered when buyi...

Contributors: Andrew Weaver
5 May 2022

The Economic Crime (Transparency and Enforcement) Act 2022: a Jersey perspective

The new Economic Crime (Transparency and Enforcement) Act received Royal Assent on 15 March 2022 (th...

Contributors: Andrew Weaver, Gemma Whale
21 Apr 2022

Listing Private Equity Acquisition Debt on The International Stock Exchange

This article provides a summary of Appleby listing agent services in the Channel Islands, and also o...

12 Apr 2022

Trustee Knowledge Series: Masters Paper One: PTC Structures

Appleby Private Client & Trust Partner David Dorgan has authored and distributed a series of Tru...

16 Mar 2022

Trustee Knowledge Series: Advanced Paper Eight: Amending Mistakes

It is almost inevitable that during the life of most trusts (which can now last indefinitely in many...