{"id":1077,"date":"2025-11-04T09:25:10","date_gmt":"2025-11-04T09:25:10","guid":{"rendered":"https:\/\/iqeq.com\/je\/insights\/proposed-updates-to-jerseys-trust-law-and-a-look-to-the-future-with-data-trusts\/"},"modified":"2025-11-07T11:02:19","modified_gmt":"2025-11-07T11:02:19","slug":"proposed-updates-to-jerseys-trust-law-and-a-look-to-the-future-with-data-trusts","status":"publish","type":"post","link":"https:\/\/iqeq.com\/je\/insights\/proposed-updates-to-jerseys-trust-law-and-a-look-to-the-future-with-data-trusts\/","title":{"rendered":"Proposed updates to\u00a0Jersey\u2019s trust law\u00a0and a look to the future with data trusts\u00a0"},"content":{"rendered":"
\n

By Sarah Bartram-Lora Reina, Head of Client\u00a0and Intermediaries, Jersey<\/span><\/i>\u00a0<\/span><\/p>\n

Jersey\u2019s\u00a0highly\u00a0regarded\u00a0trust legislation,\u00a0which\u00a0recently celebrated its 40th anniversary,\u00a0has been reviewed to ensure it\u00a0remains\u00a0current and fit for purpose\u00a0\u2013\u00a0partly\u00a0in light of\u00a0recent key court judgements.\u00a0Here\u2019s\u00a0a summary of\u00a0the main\u00a0<\/span>proposed\u00a0amendments<\/span><\/a>:<\/span>\u00a0<\/span><\/p>\n

Priority for secured lenders\u00a0in cases of trust insolvency<\/h2>\n

The first\u00a0proposed change\u00a0to the\u00a0Trusts (Jersey) Law 1984 (\u201cTJL84\u201d)\u00a0follows\u00a0the\u00a0Jersey case of\u00a0Re Z\u00a0Trust,\u00a0which looked at the priority of claims\u00a0if a trust becomes insolvent\u00a0and\u00a0there are\u00a0both\u00a0former and current trustees as well as a secured lender.<\/span>\u00a0<\/span><\/p>\n

Whilst the judgement looked at other aspects and is lengthy, the proposed amendment\u00a0to\u00a0the TJL84\u00a0is to clarify that, in cases\u00a0where\u00a0there\u2019s a creditor\u00a0who\u00a0has\u00a0taken security over the trust\u00a0assets, they\u00a0can\u00a0enforce their security\u00a0before\u00a0the\u00a0trustees can claim\u00a0over the assets for\u00a0their fees or expenses.<\/span>\u00a0<\/span><\/p>\n

This\u00a0amendment\u00a0will be of\u00a0comfort\u00a0to lenders\u00a0and aims to give them\u00a0more confidence when lending against trust assets.<\/span>\u00a0<\/span><\/p>\n

Trust\u00a0termination\u00a0prevented\u00a0in cases of future beneficiaries<\/h2>\n

The next\u00a0proposed change\u00a0follows\u00a0consideration of\u00a0the\u00a0Guernsey case\u00a0of\u00a0<\/span>Rusnano<\/span><\/a>, which looked at the ability of beneficiaries to call for the termination or variation of\u00a0a\u00a0trust\u00a0under the principles set out in the\u00a0well-known\u00a0Saunders v Vautier\u00a0case.<\/span>\u00a0<\/span><\/p>\n

It was agreed prudent to\u00a0amend\u00a0Article 43 of the TJL84\u00a0to\u00a0provide\u00a0clarity\u00a0that,\u00a0in trusts\u00a0where there\u2019s a power to add\u00a0new\u00a0beneficiaries\u00a0in the future\u00a0(even if that power isn\u2019t exercisable currently),\u00a0this provision prevents the trust from coming to an end\u00a0\u2013\u00a0even if all the current beneficiaries agree to its termination\u00a0\u2013\u00a0unless the class has closed or the trust is discretionary.<\/span>\u00a0<\/span><\/p>\n

This\u00a0change\u00a0aims to avoid unnecessary Jersey court applications.<\/span>\u00a0<\/span><\/p>\n

Smaller\u00a0revisions\u00a0and deletions<\/h2>\n

Further small\u00a0additional\u00a0changes\u00a0were\u00a0proposed, including:<\/span>\u00a0<\/span><\/p>\n