OpenLegislation

Trustee Act 1925 in Northern Ireland

15 & 16 Geo. 5 c. 19 · Enacted 9 April 1925 · Extends to England, Wales and Northern Ireland

Up to date with all changes known to legislation.gov.uk, revised to 31 October 2022.

Contents

  1. General Powers
  2. 13Power to sell subject to depreciatory conditions.
  3. 16Power to raise money by sale, mortgage, &c.
  4. 17Protection to purchasers and mortgagees dealing with trustees.
  5. 18Devolution of powers or trusts.
  6. Indemnities
  7. 28Protection in regard to notice.
  8. 29. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Repealed
  9. Maintenance, Advancement and Protective Trusts
  10. 33Protective trusts.
  11. 38Evidence as to a vacancy in a trust.
  12. Part IV: Powers of the Court
  13. 42Power to authorise remuneration.
  14. 43Powers of new trustee appointed by the court.
  15. Vesting Orders
  16. 47Vesting order consequential on order for sale or mortgage of land.
  17. 55Orders made upon certain allegations to be conclusive evidence.
  18. 56Application of vesting order to property out of England.
  19. 57Power of court to authorise dealings with trust property.
  20. 58Persons entitled to apply for orders.
  21. 60Power to charge costs on trust estate.
  22. 61Power to relieve trustee from personal liability.
  23. 62Power to make beneficiary indemnify for breach of trust.
  24. 63Payment into court by trustees.
  25. 63AJurisdiction of County Court.
  26. 64Application of Act to Settled Land Act Trustees.
  27. 65. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Repealed
  28. 66Indemnity to banks, &c.
  29. 67Jurisdiction of the “court.”
  30. 69Application of Act.
  31. 70Enactments repealed.
  32. 71†Short title, commencement, extent.
  33. Schedule FIRSTSchedule FIRST
  34. Schedule SECONDSchedule SECOND

13Power to sell subject to depreciatory conditions.

(1)

No sale made by a trustee shall be impeached by any beneficiary upon the ground that any of the conditions subject to which the sale was made have been unnecessarily depreciatory, unless it also appears that the consideration for the sale was thereby rendered inadequate.

(2)

No sale made by a trustee shall, after the execution of the conveyance, be impeached as against the purchaser upon the ground that any of the conditions subject to which the sale was made may have been unnecessarily depreciatory, unless it appears that the purchaser was acting in collusion with the trustee at the time when the contract for sale was made.

(3)

No purchaser, upon any sale made by a trustee, shall be at liberty to make any objection against the title upon any of the grounds aforesaid.

(4)

This section applies to sales made before or after the commencement of this Act.

16Power to raise money by sale, mortgage, &c.

(1)

Where trustees are authorised by the instrument, if any, creating the trust or by law to pay or apply capital money subject to the trust for any purpose or in any manner, they shall have and shall be deemed always to have had power to raise the money required by sale, conversion, calling in, or mortgage of all or any part of the trust property for the time being in possession.

(2)

This section applies notwithstanding anything to the contrary contained in the instrument, if any, creating the trust, but does not apply to trustees of property held for charitable purposes, or to trustees of a settlement for the purposes of the M1Settled Land Act, 1925, not being also the statutory owners.

17Protection to purchasers and mortgagees dealing with trustees.

No purchaser or mortgagee, paying or advancing money on a sale or mortgage purporting to be made under any trust or power vested in trustees, shall be concerned to see that such money is wanted, or that no more than is wanted is raised, or otherwise as to the application thereof.

18Devolution of powers or trusts.

(1)

Where a power or trust is given to or imposed on two or more trustees jointly, the same may be exercised or performed by the survivors or survivor of them for the time being.

(2)

Until the appointment of new trustees, the personal representatives or representative for the time being of a sole trustee, or, where there were two or more trustees of the last surviving or continuing trustee, shall be capable of exercising or performing any power or trust which was given to, or capable of being exercised by, the sole or last surviving or continuing trustee, or other the trustees or trustee for the time being of the trust.

(3)

This section takes effect subject to the restrictions imposed in regard to receipts by a sole trustee, not being a trust corporation.

(4)

In this section “personal representative” does not include an executor who has renounced or has not proved.

28Protection in regard to notice.

A trustee or personal representative acting for the purposes of more than one trust or estate shall not, in the absence of fraud, be affected by notice of any instrument, matter, fact or thing in relation to any particular trust or estate if he has obtained notice thereof merely by reason of his acting or having acted for the purposes of another trust or estate.

29. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F1

33Protective trusts.C1

(1)

Where any income, including an annuity or other periodical income payment, is directed to be held on protective trusts for the benefit of any person (in this section called “the principal beneficiary”) for the period of his life or for any less period, then, during that period (in this section called the “trust period”) the said income shall, without prejudice to any prior interest, be held on the following trusts, namely:—

(i)

Upon trust for the principal beneficiary during the trust period or until he, whether before or after the termination of any prior interest, does or attempts to do or suffers any act or thing, or until any event happens, other than an advance under any statutory or express power, whereby, if the said income were payable during the trust period to the principal beneficiary absolutely during that period, he would be deprived of the right to receive the same or any part thereof, in any of which cases, as well as on the termination of the trust period, whichever first happens, this trust of the said income shall fail or determine;

(ii)

If the trust aforesaid fails or determines during the subsistence of the trust period, then, during the residue of that period, the said income shall be held upon trust for the application thereof for the maintenance or support, or otherwise for the benefit, of all or any one or more exclusively of the other or others of the following persons (that is to say)—

(a)

the principal beneficiary and his or her F1spouse or civil partner, if any, and his or her children or more remote issue, if any; or

(b)

if there is no F2spouse or civil partner or issue of the principal beneficiary in existence, the principal beneficiary and the persons who would, if he were actually dead, be entitled to the trust property or the income thereof or to the annuity fund, if any, or arrears of the annuity, as the case may be;

as the trustees in their absolute discretion, without being liable to account for the exercise of such discretion, think fit.

(2)

This section does not apply to trusts coming into operation before the commencement of this Act, and has effect subject to any variation of the implied trusts aforesaid contained in the instrument creating the trust.

(3)

Nothing in this section operates to validate any trust which would, if contained in the instrument creating the trust, be liable to be set aside.

F3(4)

In relation to the dispositions mentioned in section 19(1) of the Family Law Reform Act 1987, this section shall have effect as if any reference (however expressed) to any relationship between two persons were construed in accordance with section 1 of that Act.

38Evidence as to a vacancy in a trust.

(1)

A statement, contained in any instrument coming into operation after the commencement of this Act by which a new trustee is appointed for any purpose connected with land, to the effect that a trustee has remained out of the United Kingdom for more than twelve months or refuses or is unfit to act, or is incapable of acting, or that he is not entitled to a beneficial interest in the trust property in possession, shall, in favour of a purchaser of a legal estate, be conclusive evidence of the matter stated.

(2)

In favour of such purchaser any appointment of a new trustee depending on that statement, and any vesting declaration, express or implied, consequent on the appointment, shall be valid.

42Power to authorise remuneration.

Where the court appoints a corporation, other than the Public Trustee, to be a trustee either solely or jointly with another person, the court may authorise the corporation to charge such remuneration for its services as trustee as the court may think fit.

43Powers of new trustee appointed by the court.

Every trustee appointed by a court of competent jurisdiction shall, as well before as after the trust property becomes by law, or by assurance, or otherwise, vested in him, have the same powers, authorities, and discretions, and may in all respects act as if he had been originally appointed a trustee by the instrument, if any, creating the trust.

47Vesting order consequential on order for sale or mortgage of land. E+W+S+N.I.

Where any court gives a judgment or makes an order directing the sale or mortgage of any land, every person who is entitled to or possessed of any interest in the land, or entitled to a contingent right therein, and is a party to the action or proceeding in which the judgment or order is given or made or is otherwise bound by the judgment or order, shall be deemed to be so entitled or possessed, as the case may be, as a trustee for the purposes of this Act, and the court may, if it thinks expedient, make an order vesting the land or any part thereof for such estate or interest as that court thinks fit in the purchaser or mortgagee or in any other person:

Provided that, in the case of a legal mortgage, the estate to be vested in the mortgagee shall be a term of years absolute.

55Orders made upon certain allegations to be conclusive evidence.

Where a vesting order is made as to any land under this Act or underF1 sections 15 to 20 of the Mental Capacity Act 2005 or any corresponding provisions having effect in Northern Ireland , founded on an allegation of any of the following matters namely—

F2(a)

that a trustee or mortgagee lacks capacity in relation to the matter in question;

(b)

that a trustee or mortgagee or the personal representative of or other person deriving title under a trustee or mortgagee is out of the jurisdiction of the High Court or cannot be found, or being a corporation has been dissolved; or

(c)

that it is uncertain which of two or more trustees, or which of two or more persons interested in a mortgage, was the survivor; or

(d)

that it is uncertain whether the last trustee or the personal representative of or other person deriving title under a trustee or mortgagee, or the last surviving person interested in a mortgage is living or dead; or

(e)

that any trustee or mortgagee has died intestate without leaving a person beneficially interested under the intestacy or has died and it is not known who is his personal representative or the person interested;

the fact that the order has been so made shall be conclusive evidence of the matter so alleged in any court upon any question as to the validity of the order; but this section does not prevent the court from directing a reconveyance or surrender or the payment of costs occasioned by any such order if improperly obtained.

56Application of vesting order to property out of England.

The powers of the court to make vesting orders under this Act shall extend to all property in any part of His Majesty’s dominions except Scotland.

57Power of court to authorise dealings with trust property.C1

(1)

Where in the management or administration of any property vested in trustees, any sale, lease, mortgage, surrender, release, or other disposition, or any purchase, investment, acquisition, expenditure or other transaction, is in the opinion of the court expedient, but the same cannot be effected by reason of the absence of any power for that purpose vested in the trustees by the trust instrument, if any, or by law, the court may by order confer upon the trustees, either generally or in any particular instance, the necessary power for the purpose, on such terms, and subject to such provisions and conditions, if any, as the court may think fit and may direct in what manner any money authorised to be expended, and the costs of any transaction, are to be paid or borne as between capital and income.

(2)

The court may, from time to time, rescind or vary any order made under this section, or may make any new or further order.

(3)

An application to the court under this section may be made by the trustees, or by any of them, or by any person beneficially interested under the trust.

(4)

This section does not apply to trustees of a settlement for the purposes of the M1Settled Land Act, 1925.

58Persons entitled to apply for orders.

(1)

An order under this Act for the appointment of a new trustee or concerning any interest in land, stock, or thing in action subject to a trust, may be made on the application of any person beneficially interested in the land, stock, or thing in action, whether under disability or not, or on the application of any person duly appointed trustee thereof.

(2)

An order under this Act concerning any interest in land, stock, or thing in action subject to a mortgage may be made on the application of any person beneficially interested in the equity of redemption, whether under disability or not, or of any person interested in the money secured by the mortgage.

60Power to charge costs on trust estate.

The court may order the costs and expenses of and incident to any application for an order appointing a new trustee, or for a vesting order, or of and incident to any such order, or any conveyance or transfer in pursuance thereof, to be raised and paid out of the property in respect whereof the same is made, or out of the income thereof, or to be borne and paid in such manner and by such persons as to the court may seem just.

61Power to relieve trustee from personal liability.

If it appears to the court that a trustee, whether appointed by the court or otherwise, is or may be personally liable for any breach of trust, whether the transaction alleged to be a breach of trust occurred before or after the commencement of this Act, but has acted honestly and reasonably, and ought fairly to be excused for the breach of trust and for omitting to obtain the directions of the court in the matter in which he committed such breach, then the court may relieve him either wholly or partly from personal liability for the same.

62Power to make beneficiary indemnify for breach of trust.

(1)

Where a trustee commits a breach of trust at the instigation or request or with the consent in writing of a beneficiary, the court may, if it thinks fit, . . . F1, make such order as to the court seems just, for impounding all or any part of the interest of the beneficiary in the trust estate by way of indemnity to the trustee or persons claiming through him.

(2)

This section applies to breaches of trust committed as well before as after the commencement of this Act.

63Payment into court by trustees.C1

(1)

Trustees, or the majority of trustees, having in their hands or under their control money or securities belonging to a trust, may pay the same into court; . . . F1

(2)

The receipt or certificate of the proper officer shall be a sufficient discharge to trustees for the money or securities so paid into court.

(3)

Where money or securities are vested in any persons as trustees, and the majority are desirous of paying the same into court, but the concurrence of the other or others cannot be obtained, the court may order the payment into court to be made by the majority without the concurrence of the other or others.

(4)

Where any such money or securities are deposited with any banker, broker, or other depositary, the court may order payment or delivery of the money or securities to the majority of the trustees for the purpose of payment into court.

(5)

Every transfer payment and delivery made in pursuance of any such order shall be valid and take effect as if the same had been made on the authority or by the act of all the persons entitled to the money and securities so transferred, paid, or delivered.

63AJurisdiction of County Court.F1C1

(1)

The county court has jurisdiction under the following provisions where the amount or value of the trust estate or fund to be dealt with in the court does not exceed the county court limit—

  • section 41;

  • section 42;

  • section 51;

  • section 57;

  • section 60;

  • section 61;

  • section 62.

(2)

The county court has jurisdiction under the following provisions where the land or the interest or contingent right in land which is to be dealt with in the court forms part of a trust estate which does not exceed in amount or value the county court limit—

  • section 44;

  • section 45;

  • section 46.

(3)

The county court has jurisdiction—

(a)

under sections 47 and 48 of this Act, where the judgment is given or order is made by the court;

(b)

under sections 50 and 56, where a vesting order can be made by the court;

(c)

under section 53, where the amount or value of the property to be dealt with in the court does not exceed the county court limit; and

(d)

under section 63 (including power to receive payment of money or securities into court) where the money or securities to be paid into court do not exceed in amount or value the county court limit.

(4)

Any reference to the court in section 59 of this Act includes a reference to the county court.

(5)

In this section, in its application to any enactment, “the county court limit”means the amount for the time being specified by an Order in Council under section 145 of the County Courts Act 1984 as the county court limit for the purposes of that enactment (or, where no such Order in Council has been made, the corresponding limit specified by Order in Council under section 192 of the County Courts Act 1959).

64Application of Act to Settled Land Act Trustees.

(1)

All the powers and provisions contained in this Act with reference to the appointment of new trustees, and the discharge and retirement of trustees, apply to and include trustees for the purposes of the M1Settled Land Act, 1925, and trustees for the purpose of the management of land during a minority, whether such trustees are appointed by the court or by the settlement, or under provisions contained in any instrument.

(2)

Where, either before or after the commencement of this Act, trustees of a settlement have been appointed by the court for the purposes of the Settled Land Acts, 1882 to 1890, or of the Settled Land Act, 1925, then, after the commencement of this Act—

(a)

the person or persons nominated for the purpose of appointing new trustees by the instrument, if any, creating the settlement, though no trustees for the purposes of the said Acts were thereby appointed; or

(b)

if there is no such person, or no such person able and willing to act, the surviving or continuing trustees or trustee for the time being for the purposes of the said Acts, or the personal representatives of the last surviving or continuing trustee for those purposes,

shall have the powers conferred by this Act to appoint new or additional trustees of the settlement for the purposes of the said Acts.

(3)

Appointments of new trustees for the purposes of the said Acts made or expressed to be made before the commencement of this Act by the trustees or trustee or personal representatives referred to in paragraph (b) of the last preceding subsection or by the persons referred to in paragraph (a) of that subsection are, without prejudice to any order of the court made before such commencement, hereby confirmed.

65. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F1

66Indemnity to banks, &c.

This Act, and every order purporting to be made under this Act, shall be a complete indemnity to the Bank of EnglandF1the Registrar of Government Stock, any previous Registrar of Government Stock, and to all persons for any acts done pursuant thereto, and it shall not be necessary for the BankF2the Registrar of Government Stock, any previous Registrar of Government Stock or for any person to inquire concerning the propriety of the order, or whether the court by which the order was made had jurisdiction to make it.

67Jurisdiction of the “court.”

(1)

In this Act “the court” means the High Court, . . . F1, or the county court, where those courts respectively have jurisdiction.

(2)

The procedure under this Act in, . . . F2the county court shall be in accordance with the Acts and rules regulating the procedure of those courts.

69Application of Act.

(1)

This Act, except where otherwise expressly provided, applies to trusts including, so far as this Act applies thereto, executorships and administratorships constituted or created either before or after the commencement of this Act.

(2)

The powers conferred by this Act on trustees are in addition to the powers conferred by the instrument, if any, creating the trust, but those powers, unless otherwise stated, apply if and so far only as a contrary intention is not expressed in the instrument, if any, creating the trust, and have effect subject to the terms of that instrument.

(3)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F1

70Enactments repealed.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F1 without prejudice to the provisions of section thirty-eight of the M1Interpretation Act, 1889:

(a)

Nothing in this repeal shall affect any vesting order or appointment made or other thing done under any enactment so repealed, and any order or appointment so made may be revoked or varied in like manner as if it had been made under this Act;

(b)

References in any document to any enactment repealed by this Act shall be construed as references to this Act or to the corresponding enactment in this Act.

71†Short title, commencement, extent.C1

(1)

This Act may be cited as the Trustees Act, 1925.

(2)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F1

(3)

This Act, except where otherwise expressly provided, extends to England and Wales only.

(4)

The provisions of this Act bind the Crown.

Schedule FIRSTF1

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Schedule SECONDF1

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