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Offshore Cases

In the Matter of the E Trust

April 2018 Trusts

BERMUDA

SUPREME COURT

TRUST LAW – ANONYMIZATION – CONFIDENTIALITY – PRIVATE APPLICATIONS – POWER OF THE COURT TO AUTHORIZE TRANSACTIONS RELATING TO TRUST PROPERTY SECTION 47 OF THE TRUSTEE ACT 1975 – ORDER 85 OF THE RULES OF THE SUPREME COURT

This matter came before the Court on an Ex Parte Originating Summons filed on 5 April 2018 for an Order, inter alia, pursuant to Section 47 of the Trustee Act 1975 empowering the Trustees of the E Trust (“the Trust”) to add a charitable foundation (“the Foundation”) as a beneficial member of the Discretionary Class.

The Plaintiffs sought for this application to be heard privately in Chambers and for the Court file to be sealed. Additionally, Counsel applied for an Order that all Rulings and any Judgment in these proceedings be anonymized for reporting purposes.

The facts on the evidence

The Trust was settled by deed made in 2003 and it currently holds assets in excess of $20 million. There are five Trustees, one of whom is also both the Settlor and primary beneficiary.

The affidavit evidence was sworn by another one of the Trustees (the “Deponent Trustee”) with whom all the other Trustees are agreed.

The beneficiaries of the Trust are described in the Deed as the Discretionary Class, consisting of the Settlor/primary beneficiary, her now deceased husband and the RL.

The Deponent Trustee produced the Settlor’s Letters of Wishes dated 2 April 2003, which stated that it was her wish that the Trustees exercise their discretion “in so far as the RL is concerned as a beneficiary by making them a modest and anonymous distribution from time to time…. As you are aware, on the death of the survivor of my husband or I, you are obligated to appoint the Fund to the Trustees of the Foundation…”

The Deponent Trustee’s affidavit states: “The intention, by adding the Foundation to the Discretionary Class, is to allow the Trust to make charitable donations via the Foundation during the Settlor’s lifetime, which is the strong wish of the Settlor.”

While the RL is a current beneficiary of the Trust, the Foundation will in any event be the ultimate beneficiary.

The Order empowering the Trustees to add the Foundation as a beneficial member of the Discretionary Class was granted, with the condition that RL be served with the proceedings within seven days of the date of the written reasons. The Court’s reason for the stay of enforcement was “to allow the RL an opportunity to pursue any wish it might have to be heard on this application”, while expressing a provisional view that “such a pursuit from the RL would likely be futile”. The RL is neither the primary nor ultimate beneficiary of the Trust and the contributions it receives are not significant enough to give rise for concern that the assets of the Trust are inadequate to add and feed another beneficiary.

 

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In the Matter of the E Trust

 

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