Trusts (Amendment No. 4) (Jersey) Law 2006
A LAW to amend further the Trusts
(Jersey) Law 1984.
Adopted by the
States 25th April 2006
Order of Her Majesty in Council 10th October 2006
Registered by the
Royal Court 20th October 2006
THE STATES, subject to the sanction of Her Most Excellent Majesty in Council, have
adopted the following Law –
In this Law “principal Law” means
the Trusts (Jersey) Law 1984.
For Article 9 of the principal Law there shall be substituted the
following Articles –
of application of law of Jersey to creation, etc of a trust
(1) Subject to paragraph (3), any question
(a) the validity or interpretation of a trust;
(b) the validity or effect of any transfer or
other disposition of property to a trust;
(c) the capacity of a settlor;
(d) the administration of the trust, whether the
administration be conducted in Jersey or elsewhere, including questions as to
the powers, obligations, liabilities and rights of trustees and their
appointment or removal; or
(e) the existence and extent of powers,
conferred or retained, including powers of variation or revocation of the trust
and powers of appointment and the validity of any exercise of such powers,
shall be determined in
accordance with the law of Jersey and no rule of foreign law shall affect such
(2) Without prejudice to the generality of
paragraph (1), any question mentioned in that paragraph shall be determined
without consideration of whether or not –
(a) any foreign law prohibits or does not
recognise the concept of a trust; or
(b) the trust or disposition avoids or defeats
rights, claims, or interests conferred by any foreign law upon any person by
reason of a personal relationship to the settlor or by way of heirship rights,
or contravenes any rule of foreign law or any foreign judicial or
administrative order or action intended to recognize, protect, enforce or give
effect to any such rights, claims or interests.
(3) The law of Jersey relating to –
(b) conflicts of law,
shall not apply to the
determination of any question mentioned in paragraph (1) unless the
settlor is domiciled in Jersey.
(4) No foreign judgement with respect to a trust
shall be enforceable to the extent that it is inconsistent with this Article
irrespective of any applicable law relating to conflicts of law.
(5) The rule donner et
retenir ne vaut shall not apply to any question concerning the validity,
effect or administration of a trust, or a transfer or other disposition of
property to a trust.
(6) In this Article –
to any jurisdiction other than Jersey;
means rights, claims or interests in, against or to property of a person
arising or accruing in consequence of his or her death, other than rights,
claims or interests created by will or other voluntary disposition by such
person or resulting from an express limitation in the disposition of his or her
‘légitime’ and ‘donner et retenir ne vaut’ have the meanings
assigned to them by Jersey customary law;
relationship’ includes the situation where there exists, or has in the
past existed, any of the following relationships between a person and the
(a) any relationship by blood, marriage or
adoption (whether or not the marriage or adoption is recognised by law)
(b) any arrangement between them such as to give
rise in any jurisdiction to any rights, obligations or responsibilities
analogous to those of parent and child or husband and wife; or
(c) any personal relationship between the person
or the settlor and a third person who in turn has a personal relationship with
the settlor or the person as the case may be.
Article 59, this Article applies to trusts whenever constituted or
reserved by settlor
(1) The reservation or grant by a settlor of a
trust of –
(a) any beneficial interest in the trust
(b) any of the powers mentioned in paragraph
shall not affect the validity
of the trust nor delay the trust taking effect.
(a) to revoke, vary or amend the terms of a trust
or any trusts or powers arising wholly or partly under it;
(b) to advance, appoint, pay or apply income or
capital of the trust property or to give directions for the making of such
advancement, appointment, payment or application;
(c) to act as, or give binding directions as to
the appointment or removal of, a director or officer of any corporation wholly
or partly owned by the trust;
(d) to give binding directions to the trustee in
connection with the purchase, retention, sale, management, lending, pledging or
charging of the trust property or the exercise of any powers or rights arising
from such property;
(e) to appoint or remove any trustee, enforcer,
protector or beneficiary;
(f) to appoint or remove an investment
manager or investment adviser;
(g) to change the proper law of the trust;
(h) to restrict the exercise of any powers or
discretions of a trustee by requiring that they shall only be exercisable with
the consent of the settlor or any other person specified in the terms of the trust.
(3) Where a power mentioned in
paragraph (2) has been reserved or granted by the settlor, a trustee who
acts in accordance with the exercise of the power is not acting in breach of
(4) The States may make Regulations amending
Paragraphs (4) to (9) of Article 10 of the principal Law shall be
After Article 10 of the principal Law there shall be inserted
the following Article –
(1) Despite the terms of the trust, a
beneficiary may disclaim, either permanently or for such period as he or she
may specify, the whole or any part of his or her interest under a trust if he
or she does so in writing.
(2) Paragraph (1) applies whether or not
the beneficiary has received any benefit from the interest.
(3) Subject to the terms of the trust, if the
disclaimer so provides it may be revoked in accordance with its terms.”.
15 and 16 substituted
For Articles 15 and 16 of the principal Law there shall be
substituted the following Articles –
of a Jersey trust
(1) Unless its terms provide otherwise, a trust
may continue in existence for an unlimited period.
(2) No rule against perpetuities or excessive
accumulations shall apply to a trust or to any advancement, appointment,
payment or application of assets from a trust.
(3) Except where the terms of a trust provide to
the contrary, any advancement, appointment, payment or application of assets
from that trust to another trust shall be valid even if that other trust may
continue after the date by which the first trust must terminate.
(1) Subject to the terms of the trust, a trust
must have at least one trustee.
(2) A trust shall not fail on grounds of having
fewer trustees than required by this Law or the terms of the trust.
(3) If the number of trustees falls below the
minimum number required by paragraph (1) or, if greater, by the terms of
the trust, the required number of new trustees must be appointed as soon as
(4) While there are fewer trustees than are
required by the terms of the trust, the existing trustees may only act for the
purpose of preserving the trust property.”.
For Article 17(1) of the principal Law there is substituted the
following paragraphs –
“(1) Paragraph (1A) applies
(a) the terms of a trust do not provide for the
appointment of a new or additional trustee;
(b) any such terms providing for any such
appointment have lapsed or failed; or
(c) the person who has the power to make any
such appointment is not capable of exercising the power,
and there is no other power
to make the appointment.
(1A) A new or additional trustee may be appointed
(a) the trustees for the time being;
(b) the last remaining trustee; or
(c) the personal representative or liquidator of
the last remaining trustee.”.
For Article 19(3) of the principal Law there shall be
substituted the following paragraph –
“(3) If two or more trustees
purport to resign simultaneously, the effect of which would mean that there
would be no trustee, the resignations shall have no effect.”.
Article 20 of the principal Law shall be repealed.
In Article 25 of the principal Law –
paragraph (1) there shall be substituted the following paragraph –
“(1) Subject to the terms of the
trust, a trustee may delegate the execution or exercise of any of his or her
trusts or powers (both administrative and dispositive) and any delegate may
further so delegate any such trusts or powers.”;
paragraph (3) for the words “paragraph (2)” there shall
be substituted the words “this Article”.
After Article 30(3) of the principal Law there is inserted the
following paragraph –
“(3A) A trustee who resigns in order to facilitate a
breach of trust shall be liable for that breach as if he or she had not
For Article 32 of the principal Law there shall be substituted
the following Article –
liability to third parties
(1) Where a trustee is a party to any
transaction or matter affecting the trust –
(a) if the other party knows that the trustee is
acting as trustee, any claim by the other party shall be against the trustee as
trustee and shall extend only to the trust property;
(b) if the other party does not know that the
trustee is acting as trustee, any claim by the other party may be made against
the trustee personally (though, without prejudice to his or her personal
liability, the trustee shall have a right of recourse to the trust property by
way of indemnity).
(2) Paragraph (1) shall not affect any liability
the trustee may have for breach of trust.”.
Article 35(3) and (4) of the principal Law shall be deleted.
For Article 37 of the principal Law there shall be substituted
the following Article –
of terms of a trust
Without prejudice to any
power of the court to vary the terms of a trust, a trust may be varied in any
manner provided by its terms.”.
For Article 42(2) to (4) of the principal Law there shall be
substituted the following paragraphs –
“(2) An application to the court
under this Article may be made by the Attorney General.
(3) In paragraph (1) ‘settlor’
means the particular person who provided the interest or property affected as
mentioned in that paragraph.”.
After Article 47 of the principal Law there shall be inserted
the following Article –
for charitable or non-charitable purposes
(1) Where trust property is held for a
charitable or non-charitable purpose and any of the circumstances mentioned in
paragraph (2) apply, the court may, on the application of a trustee or the
Attorney General, declare that the property or the remainder of the property,
as the case may be, shall be held for such other charitable or non-charitable
purpose, as the case may be, as the court considers to be consistent with the
original intention of the settlor.
(2) The circumstances are that –
(a) the purpose has, as far as is reasonably
possible, been fulfilled, has ceased to exist or is no longer applicable;
(b) the purpose cannot be carried out having
regard to the directions given by the settlor or the spirit of the gift;
(c) the purpose provides a use for only part of
the trust property;
(d) the property, and any other property
applicable for a similar purpose, can more effectively be applied to a common
purpose, regard being had to the spirit of the gift;
(e) the purpose was laid down by reference to an
area that is no longer a unit for that purpose, or by reference to a class of
persons or to an area that is no longer appropriate, regard being had to the
spirit of the gift or the practicality of administering the gift;
(f) the purpose has been adequately
provided for by other means;
(g) in the case of a trust for charitable
purposes, the purpose has ceased for what ever reason to be charitable; or
(h) the purpose has ceased in any other way to
provide a suitable and effective method of using the property, regard being had
to the spirit of the gift.
(3) Where trust property is held for a
charitable or non-charitable purpose the court may, on the application of a
trustee or the Attorney General, approve any arrangement that varies or revokes
the purposes of the trust or enlarges or modifies the powers of management or
administration of the trustees, if it is satisfied that the arrangement –
(a) is suitable and expedient; and
(b) is consistent with the original intention of
the settlor and the spirit of the gift.
(4) The court shall not approve an arrangement
under paragraph (3) unless it is satisfied that any person with a material
interest in the trust has had an opportunity to be heard.”.
Article 56 of the principal Law shall be repealed.
After Article 57(3) of the principal Law there shall be inserted the
following paragraph –
“(3A) Save as provided in paragraph (1), the
period within which an action founded on breach of trust may be brought against
a former trustee by a current trustee is 3 years from the date on which
the former trustee ceased to be a trustee of the trust.”.
This Law may be cited as the Trusts (Amendment No. 4) (Jersey)
Law 2006 and shall come into force 7 days after its registration.
m.n. de la haye
Greffier of the States