Trustee Flashcards
Q1. Why is the section on trustees in Jersey trust law particularly long and important?
A1. It covers all the rights, duties, and powers of trustees (as listed at paragraph 2(ii) in the syllabus), and there is no natural break in the topic – so it is long and should be studied in stages.
Q2. According to Article 2 of the Trusts (Jersey) Law 1984, how is a trustee functionally described?
A2. A trustee is someone who “holds or has vested in them (or is deemed to hold or have vested in them) property not owned in their own right” for beneficiaries or purposes.
Q3. In Jersey law, is a trustee just a nominal holder, like an agent?
A3. No. A trustee is the legal owner of the trust property in their own name, but must manage it for someone else’s benefit (or for a purpose). This is different from merely having possession (as an agent might).
Q4. What does Article 54 achieve regarding trust assets and the trustee’s personal affairs?
A4. It “ring-fences” trust assets so that the trustee’s personal creditors, heirs, or spouse cannot claim against the trust property, except to the extent the trustee is also a beneficiary.
Q5. What if a trustee becomes insolvent?
A5. Under Article 54(4), the trustee’s personal creditors still cannot seize trust property. They only have rights against whatever beneficial interest the trustee holds in the trust (if any).
Q6. Why do we say a trustee holds an “office”?
A6. Because the rights, powers, and obligations of a trustee pass to a successor trustee upon removal or retirement. However, property title does not automatically transfer and must be formally vested in the new trustee.
Q7. Under Article 16, must a Jersey trust always have more than one trustee?
A7. Not necessarily. Article 16(1) only requires at least one trustee. Some trust deeds require more, but the statutory minimum is one.
Q8. If the number of trustees falls below the required minimum, does the trust fail?
A8. No. Article 16(2) states the trust will not fail; however, the remaining trustee(s) can only act to preserve trust property until new trustees are appointed.
Q9. If the terms of the trust do not specify how to appoint a new trustee, who can do it under Article 17(1A)?
A9.
The existing trustee(s), if more than one (acting unanimously),
The last remaining trustee, or
The personal representative or liquidator of the last trustee,
so long as there is no other power provided in the trust.
Q10. Does appointing a new or additional trustee in Jersey happen automatically?
A10. No. While the office of trustee itself passes, the legal title to the trust property must be formally transferred to the new or additional trustee, using appropriate documents or processes.
Q11. After a trustee retires or is removed, how do the trust assets become vested in the new trustee?
A11. It must be done by separate acts (e.g., updating asset registers, executing share transfers, changing land title) – it’s not automatic under Jersey law.
Q12. What is the retiring trustee’s duty regarding vesting property in the new trustee?
A12. They must cooperate fully—hand over documents, provide explanations, and sign necessary forms so the trust property can properly transfer. Failure to cooperate could lead to liability for any resulting loss.
Q13. Summarize the essential points about trustees in Jersey law.
A13.
A trustee is the legal owner of trust property but holds it for beneficiaries or purposes.
Article 54 protects trust assets from the trustee’s personal creditors.
A trustee’s role is an office, so powers & duties pass to successors, but ownership must be formally transferred.
At least one trustee is required; if fewer trustees exist than required, they can only act to preserve assets until replacements are appointed.
Article 17 outlines how to appoint new trustees out of court, reminding parties to formally vest property in new trustees.
