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Whack a mole on isle of man

Laying down the law

Kevin O’Loughlin details trust law changes in the Isle of Man

A proposal to the Isle of Man Government, by STEP Isle of Man, to change the jurisdiction’s trust law has recently come to fruition in the Trusts and Trustees Act 2023 (the Act). The Act became fully operative on 1 December 2023.

 

Disclosure of trust information

The Act introduces a new provision relating to the disclosure of trust information, defined widely to include information or a document relating to a trust. The section provides that the terms of a trust can make provision for disclosure of trust information, subject to an order of the court. The section then provides that beneficiaries can request disclosure of trust information and that the trustee may refuse if in the interests of a beneficiary or the beneficiaries generally; again, this is subject to any order of the court. The section preserves the Londonderry exception for the trustee’s deliberations/reasons.[1] The section then provides that the court has a general power to order disclosure of trust information. Finally, the section provides that a trustee must disclose trust information to a person having a supervisory, regulatory or enforcement function for the purposes of that function.

The section provides a statutory framework for disclosure of trust information, consistent with Schmidt v Rosewood principles, i.e., that a beneficiary’s proprietary right to seek disclosure of trust document depend upon ‘the Courts inherent jurisdiction’.[2] The section does not give guidance as to the principles applicable to exercising the court’s discretion to order disclosure, therefore the case law on disclosure in exercise of the court’s inherent or supervisory jurisdiction will remain applicable.

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