By the enactment of the Trustee Amendment Act 2014, the Bermuda legislature inserted a new section 47A into the Trustee Act 1975. The purpose of this reform was to provide a statutory mechanism by which flawed decisions of trustees and other fiduciaries could be set aside upon application to the court. The stated purpose of this law reform was to introduce into Bermuda statutory law the so-called “Rule in Re Hastings-Bass” as it had been understood in England and Wales (and other common law jurisdictions) prior to the decision of the English Court of Appeal in Pitt v. Holt, Futter v. Futter [2011] EWCA Civ 197.
The Supreme Court of Bermuda has now delivered the first judgment under section 47A in the cases of In the Matter of the F Trust and In the Matter of the A Settlement ([2015] SC (Bda) 77 Civ (13 November 2015)). In these cases the Court set aside the exercise of powers of appointment of an on-shore trustee which had failed to take into consideration disadvantageous fiscal consequences. In the decision the Court confirmed that section 47A provided an unfettered statutory discretion in respect of which it was unnecessary to articulate any particular “test” for its exercise.
A copy of the decision can be found here: 1