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Trustees' Powers and Duties and Personal Liability for Breach - Breach of Trust and Breach of Duty - Limitation of Liability

5 important questions on Trustees' Powers and Duties and Personal Liability for Breach - Breach of Trust and Breach of Duty - Limitation of Liability

Application of Limitation of Liability

Only relevant when the claimant successfully has proved there is a breach by the fiduciary/trustee. Such limitations are applied by the fiduciary/trustee (defendant).

Exclusion or Limitation of Liability for Breach of Trust or Breach of Fiduciary Duty

Exclusion clause in the trust instrument
Limitation period
Relief of liability by the court (section 61 TA 1925)
Acquiescence
Consent of beneficiaries

Section 61 Trustees Act 1925

This provision gives a judge a discretion to relieve a trustee wholly or partly from personal liability for breach of trust where the trustee acted honestly and reasonably, and ought fairly to be excused for the breach of trust and for omitting to obtain the directions of the court.

Re Pauling's Settlement [1964]

It was held that the beneficiaries could not be considered to have acquiesced in a breach of trust because they were only informed of their rights relating to a breach of trust much later, even though one of the claimants was a barrister.

Section 62 Trustees Act 1925

Where a trustee who breaches a trust at the instigation or request or with the written consent of a beneficiary, the court has a discretion to impound all or part of beneficiary's interest in the trust by way of indemnifying the trustee or any person claiming through the trustee.

The question on the page originate from the summary of the following study material:

The Principles of Equity and Trusts | 9780199570041 | Graham Virgo

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