The Trustees of the X Trusts sought direction in relation to various matters relating to the administration of the X Trusts. The present judgment relates to their application for directions as to “whether they should remain as trustees of the X trusts or retire”.
The Trustees are private trust companies which have for some years been responsible for managing the Trusts which control underlying assets worth billions of dollars. The beneficiaries may for present purposes be described as falling into two family branches, the Y branch which contends that the Trustees are liable to be removed and the Z branch which contends that they are not. The Trustees adopted an essentially neutral position although their counsel firmly challenged any suggestion of wrongdoing on their part.
The need for the directions arose in the following way. Following meetings between the Trustees and beneficiaries, the Trustees produced a ‘Proposed Plan’ for the future of the X Trusts. The Y branch expressed shock and dismay at certain aspects of the Proposed Plan, in particular the fact that the Trustees had reached firm decisions to usher in “epochal” changes to the trust structure without adequately consulting the Y branch. It was complained that it was no longer possible for the Y branch to have any confidence in the ability of the Trustees to manage the proposed restructuring in a fair manner.
The following questions arose for determination:
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In the Matter of the X Trusts