Jan 2014
BRITISH VIRGIN ISLANDS
HIGH COURT
BVI DISCRETIONARY TRUST – SOLE ASSET ENTIRE ISSUED SHARE CAPITAL OF INVESTMENT COMPANY – MANAGEMENT OF INVESTMENTS DELEGATED TO PROFESSIONAL MANAGERS – ALMOST ENTIRE VALUE OF TRUST FUND LOST – DUTIES OF TRUSTEE – WHETHER TRUSTEE UNDER A DUTY TO REVIEW – PERFORMANCE OF MANAGERS – APPROACH TO THE ASSESSMENT OF EQUITABLE COMPENSATION – COURT’S POWER TO AWARD INTEREST IN EQUITY
In this case the current trustee of a BVI discretionary trust, Appleby Corporate Service (BVI) Limited (“Appleby”) sought an Order requiring the former trustee, Citco Trustees (BVI) Limited (“Citco”) to reconstitute the trust fund by compensating the trust for losses, which it claims were suffered by the trust as a result of the negligence of Citco. The sole asset of the trust was the entire issued share capital of an investment company. The investments were delegated to professional managers who disregarded contractual investment guidelines with a resultant loss of almost the entire value of the trust fund.