About this Seminar
It is now invariably asserted that a trustee, in the face of a claim seeking to impeach his or her trust or seeking to assert a proprietary right to trust assets superior to that of the trust’s beneficiaries, is obliged to take a neutral position and leave the relevant dispute to be fought between the claimant and the trust’s beneficiaries.
However, whether a trustee is obliged to take a neutral position in such a trust dispute is, perhaps, not as simple as the orthodox position would have it. It is arguable that the question of a trustee’s right to an indemnity from trust assets has become confused with what a trustee, having accepted his or her appointment as trustee, is bound to do as trustee. These two matters are, of course, not unrelated but, in any enquiry, the former should succeed the latter. It seems that, sometimes, the questions are asked the other way around.
A trustee may take a neutral position in a trust dispute, depending on the circumstances, having sought and received the Court’s approval that he do so but it ought to be considered whether the position from which a trustee – acting bona fide and having undertaken all necessary KYC and source of funds enquiries (and, prima facie, not being a dishonest assistant to a breach of trust or fiduciary duty) – should start is that, as trustee and legal owner of the property held on the trust and subject to the relevant claim, he or she is obliged to defend that claim and defend the trust property from that claim.
In this talk, we will consider whether the trustee’s duty, in the face of a claim to trust assets, is to be neutral no matter what; it may be that the answer to the question is more complicated than that and that, while a trustee’s neutrality is appropriate if the trustee has concluded, subsequent to having accepted the trust, that the claimant has a better title to the assets settled on the trust than that enjoyed previously by the settlor and now by the beneficiaries, this does not describe all such claims and, therefore, neutrality in a trust dispute is not an appropriate automatic response by a trustee.
Issues to be addressed include:
- How does a trustee balance his or her duty to his or her beneficiaries with a possible duty to an adverse claimant to trust assets?
- How does a trustee protect his or her position on costs?
- Can beneficiaries of a trust force a trustee to defend a relevant claim against the trustee’s will?
- Conversely, can a claimant force a trustee to remain neutral in the dispute?
- What should a trustee do when faced with claims against trust property where litigation has not been commenced and threats only have been made?
Cases will be examined across common law jurisdictions, including Singapore and Hong Kong. The speaker will conclude with a practical plan of action for a trustee to deal effectively with claims against trust property adverse to the trust.
This topic should be of interest to both contentious and non-contentious private client and trusts practitioners and directors and senior managers and directors of professional trustee companies.
Registrations & Standing Buffet Lunch
Opening Remarks by Chairperson:
12:45 – 1:45pm
Eschewing neutrality – trustees’ duties when faced with adverse claims to trust assets
1:45 - 2:00pm
Q & A Session
Closing Remarks by Chairperson
About the Chairperson
Ms. Annette Sui - Managing Director and Head of Private Wealth Solutions, Southeast Asia, HSBC Private Bank
Appointed as Managing Director and Head of Private Wealth Solutions, HSBC Private Bank, Annette oversees the trust business in Southeast Asia.
Annette joined the HSBC Group in 2004. As a senior member of the Bank, she identifies, develops and directs the implementation of wealth strategies for the business. A veteran with over 20 years of experience, Annette established strong contact with the ultra-high net worth clients in the region, working closely with their families and professional intermediaries on trust and related wealth management issues. She plays an instrumental role in building and profiling the trust business in Southeast Asia as the preferred and highly regarded provider of wealth protection solutions to the ultra-high net worth families.
Prior to joining HSBC, Annette was with Ernst & Young for 9 years heading one of teams in Audit and Assurance Business Services department.
She holds a Master of Business Administrative and a Chartered Accountant. She is a recognised TEP (Trust and Estates Practitioner) and a Committee Member of STEP Singapore Branch.
About the Speakers
Mr. Paul Tracey - Consultant, Grosvenor Law
Paul Tracey is admitted as a solicitor in Australia and England and as an advocate in Jersey. He specialises in trusts and fiduciary disputes. He has worked in commercial litigation in London, Jersey and Sydney and has acted for both trustees and beneficiaries in a number of the most substantial recent offshore trusts disputes including acting as Counsel for the trustee in the Alhamrani litigation in Jersey. He is also instructed regularly to advise and provide opinions for offshore trustees. He also has particular experience and expertise in insolvency, company and shareholders’ disputes, banking and financial services litigation and reinsurance disputes. Paul is a member of the Society of Trust and Estates Practitioners and the Association of Contentious Trust and Probate Specialists. As a Jersey advocate, he is also a member of the Chancery Bar Association and the Commercial Bar Association. He regularly presents papers for on current aspects of trusts litigation in London, Jersey, Sydney and Hong Kong for both trustees and private client advisers.
STEP Singapore CPD Training Level: Update