Jersey: Mubarak v Mubarik - A Clarification Of Article 47 Of The Trusts (Jersey) Law 1984

The notorious litigation in Mubarak v Mubarik may finally have come to a conclusion in the Jersey Court of Appeal decision on the 19 November 2008. The judgment is the appeal against the decision in the Royal Court of the Deputy Bailiff in In the Matter of IMK Family Trust (15 August 2008). The two decisions confirm the Jersey Court's approach to the English Family Division's purported variation or alteration of Jersey trusts.

Article 47 of the Trusts (Jersey) Law ("the 1984 Law") became the vehicle to vary the Trust and the means by which the wife could be given access to the funds in Trust. The Court of Appeal decision is therefore a clarification of the width of Article 47 and its practical application.

In the Royal Court the Deputy Bailiff had ordered (i) a variation of the family trust pursuant to Article 47 of the 1984 Law; (ii) the removal of The Craven Trust Company Ltd as trustee of the trust and (iii) appointed two individuals as receivers and managers to the assets of the trust pursuant to Article 51 of the Trusts (Jersey) Law 1984. In giving the leading judgment in the Court of Appeal, Sir Michael Beloff, QC upheld the judgment of the Deputy Bailiff, with some clarification of the orders made by the Royal Court.


In 2007 Holman J in the High Court in England had sought to vary the Jersey governed family trust to enable the First Respondent Wife to receive a lump sum of £4.875m awarded to her in ancillary relief proceedings as long ago as 1999. The First Respondent Wife had previously been excluded as a beneficiary to the family trust and, under the terms of the trust deed, the power to add beneficiaries could not be exercised in favour of an excluded person.

The Deputy Bailiff found that by reason of Article 9(4) and Article 9(1) of the 1984 Law the Royal Court could not enforce a judgment of the Family Division varying or altering a Jersey trust under the provisions of the 1973 Matrimonial Causes Act. Thus, the Royal Court gave power to the statutory amendment of Article 9 which Jersey lawyers had long been expecting.

The Royal Court could however (in certain circumstances) give effect to an order of the Family Division by giving directions pursuant to Article 51 of the 1984 Law. To do so, the order must involve something the trustees had power to do under the Trust (a variation). Whether the variation could be given effect would then be a matter for judicial discretion taking into account the interests of the beneficiaries.

In this case, the Royal Court held that it could not give effect to the judgment of Holman J pursuant to Article 51 of the 1984 Law, because it would have been directing the trustees to act in a manner outside the powers conferred on them by the trust deed.

That was not however, the end of the matter. Mr Mubarak, in order to take part in English proceedings, had written a letter in 2006 to the trustees in which he consented to the payment of the lump sum to his wife from the Trust ("the 2006 letter") The Royal Court found it could give approval under Article 47 of the 1984 Law to a variation of the trust deed, because it considered all adult beneficiaries to have consented to the variation (the 2006 letter being considered as Mr Mubarak's consent) and the representative of the minor and unborn beneficiaries also consented. The trustee maintained a neutral stance.

It was this decision which became the subject of the appeal.


The Appellant Husband contended that giving effect to the order of Holman J would amount to a complete resettlement of the trust. As such this constituted neither a variation nor a revocation of the terms of the trust and the Court had no power to approve it under Article 47.

This contention was rejected. Sir Michael Beloff QC held that whilst the First Respondent Wife had been excluded as a beneficiary to the trust, that exclusion was revocable. The exclusion could be revoked and as a reinstated beneficiary she was given a particular interest restricted to the extent of her entitlement under the orders made in the divorce proceedings. Her entitlement therefore remained one under the trust. Sir Michael Beloff QC confirmed that Article 47 of the 1984 Law empowered approval of an arrangement which is so extensive as to leave little of the existing trust provisions extant, as long as those benefitting from the arrangement were within the terms of the Trust and entitled to the Court's protection (paragraph 83 of the judgment).

The Appellant Husband contended that the Deputy Bailiff had failed to grant approval to the variation on behalf of unascertained beneficiaries.

The Court of Appeal found that the Advocate appointed to represent the minor and unborn beneficiaries had also represented the unascertained beneficiaries. The omission to refer to unascertained beneficiaries in the Court order had been a mere slip. Sir Michael Beloff QC noted that ordinarily the interests of unascertained beneficiaries would be best represented by the trustees (provided the trustees were maintaining a neutral stance).

Sir Michael Beloff QC continued: if the Court of Appeal was wrong on this point, it reconvened itself as the Superior Number and decided to approve the variation under Article 47 on behalf of the unascertained beneficiaries itself.

The Court of Appeal went onto consider whether it had the power to grant approval on behalf of unascertained beneficiaries in circumstances where the Appellant Husband argued he had retained a general power to appoint further beneficiaries to the trust, a power which he had not released.

The Court of Appeal held that Jersey Law was sufficiently wide to give the Royal Court the power to grant approval on behalf of unascertained beneficiaries, even if a potential member of the relevant class is in existence.

The question was then whether the object of a fiduciary power had the ability to block an arrangement. Here, whether Mr Mubarak had the ability to block the variation as the object of a general fiduciary power to appoint further beneficiaries to the Trust. Lord Walker in Schmidt v Rosewood Trust Ltd [2003] 2AC 709 Privy Council suggested that the object of such a fiduciary power would have such power unless the trustees have the authority to release the power granted.

Sir Michael Beloff QC however, held that only where the Jersey court was considering either (a) the position of a single default beneficiary or (b) a restricted class from whom one or more must be chosen, and all of whom agree in objecting, could it be said that the object of a fiduciary power would have power to block an application for approval."

The Court went onto to find that even if wrong on this, the Appellant Husband had, by the 2006 letter, thereby given his irrevocable consent to the variation of the trust deed and in so doing released his power of appointment.

Importantly, the Court of Appeal concluded that the proper characterisation of the determination of a Court in an application under such as Article 47 of the 1984 Law is not to vary the trust but, rather, to supply the missing consent. . Here, the Appellant was required, in advance, irrevocably to submit to being bound by such proposals as were set out in the Holman order. It is those very proposals which the orders below sought to give effect to.


The Court of Appeal declined to express a view on whether Article 9(4) of the 1984 Law allows the Royal Court to enforce a judgment of the Family Division in England varying or altering a Jersey trust under the Matrimonial Causes Act 1973. In practical terms this debate may now be defunct given the ready use of Article 47 and 51 of the 1984 Law by the Courts to give effect to orders made in foreign proceedings.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions