Privy Council case of Equity Trust v Halabi – CPD opportunity from HNW Advisor
12/01/2023
I thought you would be interested in learning more about the ground-breaking Privy Council case of Equity Trust v Halabi.
Equity Trust (Jersey) Ltd (Respondent) v Halabi (in his capacity as Executor of the Estate of the late Madam Intisar Nouri) (Appellant) (Jersey)
ITG Ltd and others (Respondents) v Fort Trustees Ltd and another (Appellants) (Guernsey) [2022] UKPC 36
On appeal from: [2019] JCA 106 & [2020] GCA043
BACKGROUND
- The Privy Council case of Equity Trust v Halabi considers, amongst other things, the nature and scope of a trustee’s right to be indemnified out of trust assets for expenses/liabilities properly incurred - usually via an equitable lien over the trust fund.
- The judgement is here https://www.jcpc.uk/cases/docs/jcpc-2019-0119-judgment.pdf
- Case details are here https://www.jcpc.uk/press-summary/jcpc-2019-0119.html
- The judgment focuses on what happens as between successive trustees when there’s an ‘insolvent trust’, rejecting a ‘first in time’ rule in favour of a pari passu one for enforcement between successive trustees.
CPD TRAINING
If you are interested to learn more, HNW Advisor [https://hnwadvisor.com/courses] has posted a CPD training video https://hnwadvisor.com/course/insolvent-trust-halabi
In this CPD session,
- HNW speakers [BELOW] consider how this decision will pan out in practice both from the point of view of successive and retiring trustees as well as third parties contracting with trustees.
The speakers,
- Shan Warnock-Smith KC (who argued in favour of the pari passu rule before the Privy Council), and Paul Hodgson, Deputy Group Head of Trust at Butterfield Group, offer their views from a legal point of view as well as from within the industry.
PRACTICAL ISSUES ADDRESSED AND CONSIDERED, INCLUDE:
- How will the pari passu rule pan out in practice
- What steps should trustees take following Halabi
- The mechanics and issues that need to be considered in the relationship between the outgoing and incoming trustees
- Will the retiring trustee require a retention of trust fund assets
- Could trustees contract out of the pari passu rule to get priority?
- Will trustees now be more cautious about entering into contracts?
- Might third parties now be more cautious about contracting with trustees?
- Might parties to a DORA indemnity seek to insure the indemnity
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As well as owning and publishing Comsure's copyrighted works, Comsure wishes to use the copyright-protected works of others. To do so, Comsure is applying for exemptions in the UK copyright law. There are certain very specific situations where Comsure is permitted to do so without seeking permission from the owner. These exemptions are in the copyright sections of the Copyright, Designs and Patents Act 1988 (as amended)[www.gov.UK/government/publications/copyright-acts-and-related-laws]. Many situations allow for Comsure to apply for exemptions. These include 1] Non-commercial research and private study, 2] Criticism, review and reporting of current events, 3] the copying of works in any medium as long as the use is to illustrate a point. 4] no posting is for commercial purposes [payment]. (for a full list of exemptions, please read here www.gov.uk/guidance/exceptions-to-copyright]. Concerning the exceptions, Comsure will acknowledge the work of the source author by providing a link to the source material. Comsure claims no ownership of non-Comsure content. The non-Comsure articles posted on the Comsure website are deemed important, relevant, and newsworthy to a Comsure audience (e.g. regulated financial services and professional firms [DNFSBs]). Comsure does not wish to take any credit for the publication, and the publication can be read in full in its original form if you click the articles link that always accompanies the news item. Also, Comsure does not seek any payment for highlighting these important articles. If you want any article removed, Comsure will automatically do so on a reasonable request if you email info@comsuregroup.com.