Stock -v- Pantrust International and Others [2016] JRC 053 (04 March 2016)

Stock -v- Pantrust International and Others [2016] JRC 053 (04 March 2016)

The Court found that Richard and James Wigley were in a position of conflict and failed to adequately disclose the nature and extent of their interest as required by Article 75(1) of the Companies (Jersey) Law 1991. However, the new trustee failed to discharge the burden under Article 76(3) to show that setting aside the second charge would not unfairly prejudice third parties acting in good faith or that the transaction was not reasonable and fair. Substantial sums were advanced for the benefit of St John's Manor Limited, and there was no evidence of bad faith or unreasonableness. On the asset recovery issue, the Court found on the evidence that 3NP LLC is an asset of the Manor House...

Citation
[2016] JRC 053
Parties
First Respondent (former Trustee): Pantrust; Second Respondent (former Trustee): Richard Wigley; Third Respondent (former Trustee): James Wigley; Fourth Respondent (new Trustee): Fourth Respondent (New Trustee); Party to Proceedings: John Dick Senior
Jurisdiction
Jersey
Judgment Date
04 March 2016
Procedural Posture
Trust Dispute / Interlocutory Application / Post Removal of Trustees; Interlocutory Judgment on Consequential Matters
Outcome
Second charge not set aside; 3NP LLC to be transferred to new trustee unless TIC shows cause; summons on other assets adjourned sine die; liberty to apply granted.
Legal Topics
Directors' Duties, Conflict of Interest, Setting Aside Transactions, Trust Asset Recovery, Disclosure Obligations
Trusts Company Law Equity Directors' Duties Conflict of Interest Setting Aside Transactions Trust Asset Recovery Disclosure Obligations

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Parties

Pantrust

First Respondent (former Trustee)

Richard Wigley

Second Respondent (former Trustee)

James Wigley

Third Respondent (former Trustee)

Fourth Respondent (New Trustee)

Fourth Respondent (new Trustee)

John Dick Senior

Party to Proceedings

Procedural Posture

Trust Dispute / Interlocutory Application / Post Removal of Trustees; Interlocutory Judgment on Consequential Matters

Legal Issues

  1. 1 Whether the second charge over St John's Manor should be set aside due to conflict of interest and inadequate disclosure by directors under Companies (Jersey) Law 1991
  2. 2 Whether 3NP LLC is an asset of the Manor House Trust and should be transferred to the new trustee

Ratio Decidendi

The Court found that Richard and James Wigley were in a position of conflict and failed to adequately disclose the nature and extent of their interest as required by Article 75(1) of the Companies (Jersey) Law 1991. However, the new trustee failed to discharge the burden under Article 76(3) to show that setting aside the second charge would not unfairly prejudice third parties acting in good faith or that the transaction was not reasonable and fair. Substantial sums were advanced for the benefit of St John's Manor Limited, and there was no evidence of bad faith or unreasonableness. On the asset recovery issue, the Court found on the evidence that 3NP LLC is an asset of the Manor House...

Court Disposition

Second charge not set aside; 3NP LLC to be transferred to new trustee unless TIC shows cause; summons on other assets adjourned sine die; liberty to apply granted.

Orders

  • Decline to set aside the second charge in favour of Pantrust over St John's Manor and surrounding grounds.
  • Adjourn sine die the new trustee's summons dated 29th January, 2016 regarding other assets.