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Death of Protector

Death of Protector

Postby giompizz » Tue Nov 28, 2017 11:45 am

Was just wondering if a Protector dies and there is no mechanism in the trust deed for his/her replacement, is there any statutory law or other ways to appoint a new protector? Or is the trust now stuck without a Protector to administer the trust? Who would the duty fall on?
Thanks!
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Re: Death of Protector

Postby atticus » Tue Nov 28, 2017 12:11 pm

Every now and then we get questions about "Trust Protectors". This is some kind of super trustee used in some other jurisdictions, usually "offshore".

I would suggest that responsibility falls on the trustees to sort this out.
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Re: Death of Protector

Postby atticus » Tue Nov 28, 2017 12:51 pm

This law firm article may be helpful.

If a Protector dies then they are removed from office, but this can leave the trust in disarray if there is no drafting to deal with this contingency. This is because if, on a proper construction of the trust instrument, the powers of the trust protector are considered to have been conferred on them in their individual capacity only, then the powers will die with them.

Moreover, another consequence that could arise from the death or serious incapacity of a protector is that they leave a vacancy - there is no protector able to exercise the powers set out in the trust instrument. This could lead to paralysis, depending on the way in which the particular trust instrument is drafted.

The trust instrument should, therefore, contain a mechanism for the replacement of the departing protector and make express provision for how the trust is to be administered in any interregnum period (Re Circle Trust (2006) 9 ITELR 676 (Cayman)).
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Re: Death of Protector

Postby dls » Tue Nov 28, 2017 1:22 pm

Echoing Atti, the use of the word 'protector' suggests a non-UK jurisdiction. Check the jurisdiction clause toward the end of the deed.
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Re: Death of Protector

Postby giompizz » Tue Nov 28, 2017 4:20 pm

Thanks for that article Atticus, very helpful! Do UK Jurisdiction trusts never have Protectors?
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Re: Death of Protector

Postby atticus » Tue Nov 28, 2017 5:19 pm

Never is a big word! I would not be so bold as to say that "protectors" never feature in trusts governed by the laws of any of the UK jurisdictions.
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Re: Death of Protector

Postby dls » Wed Nov 29, 2017 3:56 pm

Any drafter of a deed can choose to use any word and define it for a purpose within that document, so, Yes, the word can be used.

Any UK lawyer however would be ver doubtfull about its use, but it has no obvious particular or standard meaning in UK law.
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