Jersey: Invalid Appointments Of Protectors And Trustees: The Jersey Royal Court Provides Fresh Guidance

Last Updated: 16 October 2015
Article by Fraser Robertson and Amy Benest

The Royal Court of Jersey has recently provided important guidance in relation to the circumstances in which the Court may hold the exercise of a fiduciary power to be invalid.

In the case of In the Representation of Jasmine Trustees Limited [2015]JRC196 (in which Appleby acted for the successful applicant) the Court took the exceptional step upon the application of a beneficiary to declare the appointment of Protectors and Trustees to be invalid.

In its judgment, the Court confirmed that a person (whether they are a retiring trustee, or any other person with a power of appointment under the trust instrument) is exercising a fiduciary power both in relation to a power to appoint new trustees and a power to appoint a new protector.

The Royal Court also stated that when exercising such a fiduciary power of appointment, the appointor is under a duty to act as follows:

  • In good faith and in the interests of the beneficiaries as a whole;
  • To act reasonably;
  • To take into account relevant matters, and only those matters; and
  • Not to act for an ulterior purpose.

In this exceptional case, the Court held that the appointments of new trustees and new protectors were invalid as the appointors had not acted in accordance with the four above principles identified by the Court, and the fiduciaries were thus effectively removed from office.

The Court's determination that the duties owed by appointors of trustees and protectors are the same, whether the appointor is an outgoing trustee or a majority of adult beneficiaries, is of interest and benefit to both trust practitioners and advisers alike.

The proceedings were brought by the trustees of two family trusts and initially concerned the appointments of new trustees and protectors in relation to two family trusts. The beneficiaries of both trusts were almost identical, and included a father, his three children (defined as an elder son, a younger son (together, the sons) and a daughter) and the seven grandchildren (four of whom were adults at the time of the hearing).

The proceedings

The trustees issued the proceedings as they had unexpectedly received a deed of removal and appointment of trustees executed by the then protector of both trusts (the father). The purported new trustee was incorporated in New Zealand and unknown to the trustees. Having received the deed, the trustees sought pertinent information from the new trustees but no satisfactory replies were provided. The trustees were also concerned that the father would not or could not explain his rationale in appointing Kairos. The trustees therefore sought directions from the Royal Court as to what if any action they should take regarding the purported appointment of new trustees.

Two further appointments took place shortly after the Representations were issued: the father retired as protector and appointed his sons to act in his place in respect of one trust, and in respect of the other, he resigned as protector prompting a majority of the adult beneficiaries (in fact, all of the adult beneficiaries other than the daughter) to appoint the sons to act as protectors. Both methods of appointment complied with the formalities required by each trust.

The daughter then issued a summons challenging the purported appointments of the sons as protectors of both trusts on the basis that they were invalid or, alternatively, that they ought to be removed.

Purported appointment of Trustees

By the time of the hearing, not only did the daughter object to the appointment of the new trustees, but the sons (as purported protectors) also attempted to remove the new trustees and the father had stated that he was content for the appointment to be 'withdrawn'.

The Court concluded that the father, when he appointed the new trustees, had failed to take into account relevant factors, such as the "expertise, experience, financial standing etc. of the propose trustee", and had not reached a decision that a reasonable appointor could have reached. The father had therefore not exercised the power in line with the required duties and the appointment was accordingly found to be invalid.

Purported appointment of Protectors

As regards the appointments of the protectors, these were also found to be invalid. It was necessary for the Court to consider a large section of the family's history in reaching its decision.

It was the daughter's position that the purported appointments of the sons as protectors of both trusts could not have been made by reasonable appointors for three main reasons:

  1. that there is an actual or potential conflict of interest arising from the litigation in the United States (see below);
  2. that the sons are not sufficiently independent from the father; and
  3. that there is a complete and irretrievable breakdown in relations between the daughter and the rest of the family on the other.

As stated above, the conflict of interest arises from the US proceedings brought by the daughter, against (amongst others) the father and the sons, which included allegations as to improper conduct in the administration of the companies which had been listed in the general release, and in which she had believed she had a beneficial interest. The proceedings also included allegations of forgery, fraudulent acts, breaches of fiduciary duty and conspiracy. The Court found that due to the remedies sought in the proceedings, the outcome of the US proceedings would have "material financial impact" on the sons.

As regards the lack of independence from the father, the sons' evidence provided in the US proceedings confirmed they had done whatever the father asked of them, included signing corporate documents, and had viewed their position as directors of the companies as "titular titles" only. This along with other factors and instances, led the daughter to believe that if the sons were confirmed as protectors, they would disregard their own fiduciary duties and act in accordance with the father's wishes.

Finally, submissions were made as to the seriousness of the breakdown in relations between the daughter and the sons and the loss of trust in her brothers after the preparation of a document referred to as a "general release" which, if she had signed it, would have been to their benefit. The purpose of the general release was to confirm in a legally binding document that the father would approve a distribution to fund the lease extension if the daughter released her rights to all and any property owned by the father, or in which he had an interest and included various non-compete clauses. In the end, the daughter did not sign the general release as the trustee decided that it would be more tax efficient for the lease extension funds to be provided by way of loan (which did not require protector consent) rather than by distribution.

The general release led to a complete breakdown in relations in the family: since then, the daughter has not had contact with her brothers. Indeed, the sons did not contact her despite her suffering with cancer, getting married and having a child.

The sons' deposition evidence in the US proceedings also set out their feelings towards their sister in that they agreed with the father that she was always after money and that they were angry with her for suing them. In those circumstances, it was submitted that it would be impossible for the sons to act impartially and fairly as protectors.

The father's position meanwhile was that he considered his sons to be the best persons to act as protectors for three main reasons: first, due to their professional qualifications; secondly, their appointment is supported by most of the beneficiaries; thirdly, the sons are members of the family and so could act as a link between the family and trustees. Although the father conceded that his relationship with the daughter was troubled, he thought the sons could work with the daughter.

For their part, the sons considered themselves able to faithfully discharge their duties to all the beneficiaries. However, the sons also stated that most of the family had lost trust and confidence in the trustees due in part to their decision to grant a loan to the daughter in 2010.

The Court's decision

The Court reminded itself that it is not for the Court to interfere with an appointor's decision if it would have made a different appointment; rather the Court's jurisdiction may only be invoked if the appointor had reached a decision that no reasonable appointor could reach.

The Court accepted that the trust instrument envisaged a degree of conflict of interest, and so the fact that the sons were also beneficiaries who may be thought to have adverse interests to the daughter was not a reason to hold their appointment as protectors invalid.

However, the Court did conclude that the appointments of the sons as protectors were invalid, for reasons which included the following:

  1. the "very significant" conflict of interest that exists between the sons and the daughter by reason of the US proceedings make it impossible for the sons to act fairly as protectors;
  2. the Court did not accept that the sons were acting in a "neutral and passive" way in the US proceedings;
  3. the sons have not shown themselves as acting independently from the father, for example simply signing documents when asked to do so by him even when such documents stripped the daughter of shares;
  4. the breakdown in relations between the daughter and the sons and the sons' demonstrable feelings of acrimony towards the daughter which makes it impossible for them to act fairly as protectors; and
  5. the background hostility and suspicion between the members of the family which would inevitably lead to a frequent involvement by the Court in the administration of the trusts.


The circumstances of the case may not have been as extreme as has been examined in other protector removal cases as Re The V R Family Trust 2009 JLR 202 (where the protector was engaged in litigation concerning the trust fund itself and therefore suffered with an extreme conflict of interest). The instant case, however, demonstrates how when the various circumstances of a matter are analysed in a comprehensive and forensic fashion it can lead to appointments being found to be invalid.

The case serves as an important reminder to appointors, whether trustees, protectors, or beneficiaries with a power of appointment, to consider their duties carefully when exercising fiduciary powers to ensure that they are acting reasonably, and in good faith, taking only into account relevant factors in making an appointment.

Advocate Fraser Robertson acted and appeared on behalf of the successful applicant beneficiary assisted by Amy Benest.

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.

In association with
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
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). 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 & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd 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 or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

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