Carafe Trust - v - Guardian Trust Co Ltd and other [2005] JRC 063 (16 May 2005)

Carafe Trust - v - Guardian Trust Co Ltd and other [2005] JRC 063 (16 May 2005)

Guardian was entitled to its reasonable fees up to 30 April 2002, but acted unreasonably in rejecting the escrow arrangement and should have retired by that date. Legal fees incurred in pursuing its own interests in the fee dispute are not recoverable from the trust fund. For administration after 30 April 2002, Guardian may recover only its costs (60% of non-legal fees) and not profit. Bedell Cristin's legal fees are allowed only up to 12 April 2002.

Citation
[2005] JRC 063
Parties
Retiring Trustee: Guardian Trust Company Limited; Beneficiaries: Mr Xavier Louveaux and family; Incoming Trustee: Herald Trustees Limited
Jurisdiction
Jersey
Judgment Date
16 May 2005
Procedural Posture
Fee Dispute in Trust Administration / Post Trial Judgment
Outcome
Judgment for Guardian in the sum of £1,502.75 in addition to the £30,000 already received at retirement.
Legal Topics
Trustee Fees, Retirement of Trustee, Escrow Arrangements, Trust Administration, Legal Costs
Trusts and Estates Equity Trustee Fees Retirement of Trustee Escrow Arrangements Trust Administration Legal Costs

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Parties

Guardian Trust Company Limited

Retiring Trustee

Mr Xavier Louveaux and family

Beneficiaries

Herald Trustees Limited

Incoming Trustee

Procedural Posture

Fee Dispute in Trust Administration / Post Trial Judgment

Legal Issues

  1. 1 Whether the fees charged by the retiring trustee (Guardian) were reasonable and properly recoverable from the trust fund
  2. 2 Whether Guardian was entitled to withhold transfer of the trust pending payment of disputed fees
  3. 3 Whether Guardian acted reasonably in rejecting an escrow arrangement for disputed fees

Ratio Decidendi

Guardian was entitled to its reasonable fees up to 30 April 2002, but acted unreasonably in rejecting the escrow arrangement and should have retired by that date. Legal fees incurred in pursuing its own interests in the fee dispute are not recoverable from the trust fund. For administration after 30 April 2002, Guardian may recover only its costs (60% of non-legal fees) and not profit. Bedell Cristin's legal fees are allowed only up to 12 April 2002.

Court Disposition

Judgment for Guardian in the sum of £1,502.75 in addition to the £30,000 already received at retirement.

Orders

  • Guardian entitled to £1,502.75 plus £30,000 already paid from trust assets as fees.
  • All other claims for fees by Guardian disallowed as per judgment.