The extent to which a beneficiary is entitled to trust
information is a frequent cause of friction between beneficiaries
and trustees/executors. The basic principle is that a right to
trust information arises under the Court inherent jurisdiction to
supervise and, if necessary, to intervene on behalf of the
beneficiary to enforce the trust against the trustees.
Information should be disclosed if that would be "conducive to
the proper administration of the trust".
If the trustees do not provide trust information reasonably
requested, a beneficiary can make an application to Court for an
order that they produce an inventory and an account of the
trust/estate. The beneficiary might hope to recover the cost of
that from the reluctant trustees personally, but the recent case of
Blades -v- (1) Isaac (2) Alexander (2016) is a reminder
that the Court may decide that the costs should be paid out of the
trust fund rather than out of the trustees' own pockets, so it
can be an expensive victory for the beneficiary.
In Blades the trustees were partners in the firm of solicitors
that drew up the deceased's Will. Under the Will the
deceased left her entire estate on discretionary trusts for a class
of beneficiaries which included her daughter (the claimant), and
with power to add further beneficiaries. The Will was accompanied
by a letter of wishes that suggested the trustees should consider
giving 5% of the estate to the claimant's sister. The trustees
exercised their power to add the claimant's sister to the class
of beneficiaries and distributions were made. Difficulties arose
when the claimant asked the trustees for a breakdown of the
The trustees refused on the grounds that they had concerns about
the relationship between the claimant and her sister and that
refusal was supported by a barrister's opinion. The Trustees
refused to disclose a copy of that opinion also. A different
barrister subsequently advised the Trustees that the information
should be provided and they provided it.
The claim related to the liability for costs only. The claimant
argued that the Trustees should pay both her costs and their own in
their personal capacities. The trustees argued that the costs for
both sides should be paid out of the trust. The Judge decided that
as the barrister's opinion had been obtained for the benefit of
the trust and not for the trustees personally it was a trust
document, and should potentially be available to the beneficiaries.
The Court noted that although she could hold the trustees to
account for their dealings with the estate as discretionary
beneficiary, she did not have the same rights as a specific
legatee. The Court considered that she was entitled to bring a
claim as a beneficiary of the trust, entitled to challenge the
trustees' concerns about the proper distribution of assets. The
Court held that the trustees had breached a duty to account
initially, but that no loss had been caused to the trust. The
Trustees had belatedly acted properly, and on Counsel's advice.
The Court decided that it was not "just" to order the
trustees to pay the Claimant's costs personally.
The Court commented that the indemnity that a trustee has would
have entitled them to recover both their own costs and those
payable by the beneficiary out of the trust fund even if an adverse
costs order had been made. There was no misconduct, and the
trustees had intended to act in the best interest of the
beneficiaries. Their refusal to provide disclosure initially was
made in the context of a difficult family relationship so it would
not have been fair to deprive them of the normal
This case is therefore a good example of the application of the
rules regarding an entitlement of a beneficiary to information, and
also to the entitlement of a trustee to recover costs incurred in
that office from the trust. It is also a reminder of the importance
of taking expert advice and then in acting on it.
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.
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