Advanced Search

Trusts (Special Provisions) Amendment Act 2014

Subscribe to a Global-Regulation Premium Membership Today!

Key Benefits:

Subscribe Now for only USD$40 per month.
Trusts (Special Provisions) Amendment Act 2014
FA E R
N

AT F
TQUO U

BERMUDA

TRUSTS (SPECIAL PROVISIONS) AMENDMENT ACT 2014

2014 : 22

WHEREAS it is expedient to amend the Trusts (Special Provisions) Act 1989:

Be it enacted by The Queen’s Most Excellent Majesty, by and with the advice and
consent of the Senate and the House of Assembly of Bermuda, and by the authority of the
same, as follows:

Citation
This Act, which amends the Trusts (Special Provisions) Act 1989 (the “principal

Act”), may be cited as the Trusts (Special Provisions) Amendment Act 2014.

Amends section 2
Section 2(3) of the principal Act is amended by inserting after the words “the

reservation”, the words “or grant”.

Inserts section 2A
The principal Act is amended by inserting after section 2 the following—

“Reserved powers
Without prejudice to the generality of section 2(3), the reservation by

the settlor to himself or grant to any other person in a trust instrument governed
by the laws of Bermuda of any limited beneficial interest in the trust property
whether of income or capital, or any or all of the powers specified in subsection (2)
(or both such an interest and any or all of such powers) shall not —

invalidate the trust; or

prevent the trust taking effect according to its terms; or

2A (1)

(a)

(b)

1

2

3

1

TRUSTS (SPECIAL PROVISIONS) AMENDMENT ACT 2014

cause any or all of the trust property to be part of the real estate
or personal estate of the settlor for the purposes of the Wills Act
1988.

The powers referred to in subsection (1) are—

in the case of a reservation to the settlor or other donor of trust
property, power to revoke the trusts in whole or in part;

power to vary or amend the terms of a trust instrument or any of
the trusts, purposes or powers arising thereunder in whole or in
part;

a general, intermediate or special power to advance, appoint, pay,
apply, distribute or transfer trust property (whether income or
capital or both) or to give directions for the making of any such
advancement, appointment, payment, application, distribution or
transfer;

power to act as, or give binding directions as to the appointment
or removal of, a director or an officer of any company wholly or
partly owned by the trust or to direct the trustee as to the manner
of exercising voting rights attaching to any of the shares held in
such company;

power to give binding directions in connection with the purchase,
retention, holding, sale or other commercial or investment
dealings with trust property or any investment or reinvestment
thereof or the exercise of any powers or rights arising from such
trust property;

power to appoint, add, remove or replace any trustee, protector,
enforcer or any other office holder or any advisor including any
investment advisor or any investment manager;

power to add, remove or exclude any beneficiary, class of
beneficiaries or purpose;

power to change the governing law and the forum for
administration of the trust; and

power to restrict the exercise of any powers, discretions or
functions of a trustee by requiring that they shall only be
exercisable with the consent, or at the direction of, any person
specified in the trust instrument.

A trustee who—

has acted, or refrained from acting, in compliance with, or as a
result of, a valid exercise of any of the powers set out in subsection
(2), shall not, by reason only of such compliance, commit a breach
of trust or other fiduciary or equitable duty; or

(c)

(2)

(a)

(b)

(c)

(d)

(e)

(f)

(g)

(h)

(i)

(3)

(a)

2

TRUSTS (SPECIAL PROVISIONS) AMENDMENT ACT 2014

is or has been prevented from acting in accordance with any of the
powers specified in subsection (2), or any exercise of those powers
by reason of the provisions of any applicable law or because
insufficient rights or powers are exercisable by the trustee in
relation to the trust property, shall not, by reason only of such
non-compliance or failure to act, commit a breach of trust or other
fiduciary or equitable duty.

Where a power to revoke, a general power of appointment or the
present beneficial interest in respect of all or part of the trust property is reserved
or granted to a person, a trust instrument may provide that for so long as the
settlor, beneficiary or other holder of the power is not the sole trustee, the trustee
shall owe no duty to any other person in relation to all or such part of the trust
property and accordingly shall have no responsibility to any other person for acts
or omissions occurring during that person’s lifetime in respect of that property.

No person other than a person in whom trust property or an interest
in trust property is vested and who is formally appointed as a trustee, shall be or
become a trustee by reason only of the reservation or grant of any of the powers set
out in subsection (2).

A trust instrument governed by the laws of Bermuda may provide that
the reservation or grant of any of the powers set out in subsection (2) shall not
impose a fiduciary duty on the holder of such powers.

In relation to any trust governed by the laws of Bermuda created after
the commencement date of the Trusts (Special Provisions) Amendment Act 2014,
in the absence of any contrary provision of the trust—

in the case of the reservation by a settlor or the grant to a
beneficiary of any of the powers specified in subsection (2), where
so long as the holder of the power is not the sole trustee, such
powers shall be personal and non-fiduciary; and

in any other case, such powers shall be fiduciary.

Subject to any contrary provision herein, this section and section 2(3)
apply to any trusts governed by the laws of Bermuda, whether created before, on
or after the commencement date of the Trusts (Special Provisions) Amendment Act
2014, and to acts and omissions occurring while the trust was governed by the laws
of Bermuda.

In this Part, “settlor” includes—

a testator who grants powers under a testamentary trust by the
terms of his last will and testament; and

a person who by a declaration of trust declares that assets held by
him beneficially shall be held by him on the terms of the trust so
declared.”

(b)

(4)

(5)

(6)

(7)

(a)

(b)

(8)

(9)

(a)

(b)

[Assent Date: 16 July 2014]

3

TRUSTS (SPECIAL PROVISIONS) AMENDMENT ACT 2014

[Operative Date: 16 July 2014]

4