Representation of Oak Trustees (Jersey) Limited re X Trust (Royal Court : Hearing (Civil) : Thompson : Costs) [2026] JRC 090 (1 April 2026)

judgment the Commissioner: Introduction 1. This judgment contains firstly my decision in respect of costs following on from the substantive judgment in this matter dated 23 January 2026 ("the Main Judgment") reported at [2026] JRC 026 when the Royal Court, comprising myself and Jurats Opfermann and Gardner, blessed the decision taken by the Trustee to split assets of the Trust equally between three family lines.

2. Secondly, this judgment contains my decision on the papers in relation to the question of how far this judgment might be referred to by any party in Country 1 proceedings between the beneficiaries. For reasons I address later, I also set out how far the Main Judgment should be redacted. Costs 3. In relation to the question of costs, there was no issue between the parties that the Trustee should have its costs paid. The real issue was therefore whether the costs should be paid out of the Trust assets as a whole or out of one family line.

4. This led into the question of whether the costs of the beneficiaries should be paid out of Trust assets and, if so, should that be out of family lines or whether one family line should pay the costs of another family line.

5. In this case, I also had to deal with the costs of the original Representation and the Amended Representation brought by the Trustee. The original Representation sought directions as to whether or not the Trustee should finalise the decision taken on 10 October 2018.

6. The Representation was amended on 25 February 2025 where the Trustee sought a blessing of a decision taken by what was referred to in the Main Judgment as the Trustee 2025 Minute.

7. I have referred to this because by an Act of Court dated 19 December 2019, the costs of the Preliminary Issue were reserved until the hearing of the Representation had concluded. Submissions on costs 8. Given that the only issue in relation to the Trustee was where the burden of its costs should fall, I directed that I should be addressed firstly by Advocate Lacey for A and B, then by Advocate Kistler for C and D. I would then hear from Advocate Lincoln for the Trustee, with Advocate Lacey having the last word by way of reply.

9. Advocate Lacey sought orders that - (i) C and D should pay her clients' legal costs from 9 February 2021 which was the date she contended when C and D started behaving unreasonably on the indemnity basis. This was the date when the parties agreed Heads of Terms (see paragraphs 31 and 32 of the Main Judgment); (ii) alternatively that her clients' costs be met from the share of the trust fund allocated to C and D, rather than from the trust fund as a whole; (iii) C and D should pay her clients' legal costs of the Preliminary Issue; and (iv) C and D should pay a share of the Trustee's costs attributable and proportionate to the unreasonable conduct of C and D; 10. In particular, she criticised C and D for attempting to (a) re-litigate issues already settled by the Preliminary Issue; (b) attempting to re-open and disregard the Heads of Terms; (c) obstructing the Trustee's work through repetitive and excessive correspondence; and (d) refusing to share with the parties [redacted ].

11. She claimed that C and D had led her clients to having to incur costs which were excessive. In her Skeleton, she stated that since 2019, approximately £400,000 of costs had been incurred, with £250,000 being incurred since the Heads of Terms were signed.

12. She also complained that the total costs incurred in what should have been a straightforward blessing application were in the region of £3.2 million. These costs were those incurred since 2013 and 2014 when disputes between family members first started. The costs incurred amounted to 20% of the trust fund.

13. The essence of why C and D should bear the Trustee's costs was because in signing the Heads of Terms, no one had any expectation that any dispute would be raised about E being the Settlor for tax purposes.

14. While the parties in the Heads of Terms at Clause 13 had agreed how the costs of the Trustee between A and B and D and C should be allocated up to the date of the Heads of Terms (9 February 2021), in Clause 14, the parties had expressly recognised that the Court had the power to override the provision in respect of future costs where it considered that " a party has conducted itself unreasonably in such proceedings from the date of these Heads of Terms ".

15. Advocate Lacey also complained that the Trustee had made allegations that the handwritten agreement was disputed (see paragraph 107 of the Main Judgment). Her complaint was that serious allegations had been made against the siblings and had led to her clients incurring further costs, yet no evidence was produced to support these allegations. Advocate Lacey also contrasted the lack of evidence with the fact that the three branches had all worked together from 1988 until 2011.

16. She also referred to paragraph 36 of the Preliminary Issue judgment where Commissioner Clyde-Smith stated the following: "36. .... The Trustee appears, therefore, to have reached a conclusion on this issue after careful investigation and at considerable cost to the trust estate, and the onus should be upon C to argue why that decision should not be blessed. If C seeks to challenge any fact upon which the Trustee's decision has been based, and the Court concludes that issue needs to be determined before the decision can be blessed, then it can order the same to be determined with the burden of proof, presumably (although this will be a matter for the Court at the time), being upon C as the challenging party, no doubt on the basis that he will be subject to the usual risk as to costs. The Court would have found, of course, that factual issue to be directly relevant to the Trust.

37. Thus addressing the questions put forward by Advocate Kistler, whilst we accept that there is an element of overlap as to the background between the proceedings in Country 1 and a blessing application to this Court, the proceedings in Country 1 do not address the key issues for the Trust. Whatever findings the court in Country 1 reaches on the issues before it, those findings will not resolve the issues for the Trust. If we await the final determination of the Country 1 based proceedings, which could take years, the issues for the Trust will remain unresolved, giving rise to yet further delay, during which time the affairs of the Trust will effectively be held in abeyance. As to the second question, we do not accept that the court in Country 1 is in a better position to resolve issues of fact found by this Court to be directly relevant to the affairs of the Trust. As to the third question there are in our view compelling reasons for the blessing application to proceed, namely so that the administration of the Trust can be put on a proper footing as soon as possible." The reference to C is a reference to C.

17. Her clients were in the hands of the Court because they had no control over the actions of C and D in relation to costs. That was why her clients were dependent upon the Court making appropriate orders to sanction any unreasonable behaviour. That behaviour was wasting family wealth built up in part by her clients. She finally submitted that C had significant wealth in Country 1 and was therefore able to meet such orders.

18. Advocate Kistler in his submissions firstly complained that until he had seen the Skeleton of B and A on 20 January, he did not know what orders they were seeking although he had been asking for the same. Nevertheless, he was in a position to respond to the Skeleton Argument. His position was that the costs order should be made was the normal costs order, namely that the Trustee's costs should be paid out of the trust fund with each of A and B and C and D recovering their costs from the share of the Trust allocated to them pursuant to the decision blessed by the Court and the Heads of Terms agreed by the parties.

19. He contended that it was fair for his clients to challenge the tax advice received. It was tax advice obtained by the Trustee to which his clients were entitled to respond. There was nothing unreasonable in his clients responding to that advice and questioning how the Trust assets should be split. Tax advice was always going to be needed and had to be dealt with. The Trustee also had to form a view as to how to allocate tax liabilities.

20. He therefore emphasised that the Trustee itself in an email from Mourant to B and A dated 6 th June 2024 had stated: "By way of further information, the Trustee would like to highlight that a lot of the work undertaken in addressing the queries in the 8 December Letter has been beneficial in ensuring that the Trustee has considered all relevant factors in coming to its decision on the allocation of the Trust assets having regard, in particular, to the various tax issues. .... The Trustee would, however, like to emphasise that the delay between the hearing in 2019 and this matter being brought to a conclusion is not attributable to one particular event. This matter is not straightforward, and the tax issues it has had to consider with its advisors (which it was only able to do following the mediation that took place in February 2021) have been particularly complex, and factoring such issues into the Trustee's final decision has involved taking comprehensive advice on complex, multi-jurisdiction tax matters, in order to ensure that the tax treatment of any terminating distributions from the Trust are properly taken into account and is as favourable as possible for all of the beneficiaries." 21. His clients could not therefore be found to have acted unreasonably when the Trustee was saying that the points raised were appropriate ones to be raised.

22. Advocate Kistler also referred to the decision of In the Matter of The Piedmont Trust [2022] 1 JLR 157 . The relevance of this decision was that the costs that could be recovered had to be of and incidental to the proceedings which begged the question as to what was being claimed in those proceedings and what were they about. This led to the submission that by reference to the Amended Representation, the decision taken in 2018 about an equal split was only a preliminary decision (see paragraphs 27 to 29 of the Amended Representation). It was only in November 2023 that the Trustee decided following the receipt of tax advice to continue with the equal split, which decision was only finalised, following further challenges by his client, in February 2025.

23. In relation to those challenges, Advocate Kistler emphasised that his client had not been hostile and had not made any allegations against the Trustee or other beneficiaries. They had not referred to the handwritten agreement in 1988 to which Advocate Lacey had referred. He therefore contended this was not a case of a hostile dispute.

24. The fact that the Court had rejected his clients' views did not matter. To make an adverse costs order, more was needed than not accepting the Trustee's position. He emphasised that frequently beneficiaries have strong feelings about an issue and often decisions have to be made by trustees where sensitive matters and complicated family relationships have to be listened to. His clients should not therefore be expected to react dispassionately or to concede their own beliefs.

25. Advocate Kistler also referred to the decision in Erinvale Ptc Limited [2022] JRC 076. The analogy was that his clients also held views genuinely and passionately and that was not enough for a beneficiary to be deprived of its costs.

26. He further referred to the decision In the matter of the Piedmont Trust [2021] JRC 250 at paragraph 15(ii) which recognised the importance of beneficiaries being able to advance their views. In relation to this decision, Advocate Kistler rightly accepted that if a beneficiary made unreasonable submissions or otherwise behaved unreasonably in connection with proceedings, then that beneficiary might be deprived of its costs or may be ordered to pay or contribute towards the costs of other parties (see paragraph 15(ii)).

27. He also emphasised that the Trustee through Mourant were still considering matters as at 31 July 2024 (see an email from Advocate Lincoln to B and A) where the Trustee stated in response to further correspondence from Carey Olsen dated 22 July 2024: "What we can tell you is there are issues raised in the letter which the Trustee needs to consider (including with assistance from its tax advisor) before the Trustee will be able to proceed with the blessing application." 28. In relation to the blessing application, this was always going to be required. There were also issues determined in it where the Court had not agreed with the Trustee in relation to the scope of indemnities required (see paragraph 187 of the Main Judgment).

29. Finally, he disputed that his clients were trying to have it both ways as set out in paragraph 186 of the Main Judgment.

30. Advocate Lincoln for the Trustee, both in his written and oral submissions, confirmed that the Trustee was resting on the wisdom of the Court.

31. He fairly recognised that the correct starting point was that all parties should have their costs out of the trust fund (see Alhamrani v JP Morgan Trust Company (Jersey) Limited [2007] JLR 527 at paragraph 39).

32. He also fairly recognised that both a trustee and beneficiaries could be deprived of their costs if it was found they had acted unreasonably. In relation to beneficiaries, he referred to a passage in Lewin at paragraph 48-054 which states as follows: "In a case where a trustee makes an application for directions in consequence of the conduct of a disaffected beneficiary intent on disrupting the administration of the trust, the beneficiary is at risk at least of being deprived of his costs and at worst of being ordered to pay all the costs of the application which was made necessary by reason of his conduct. Indeed, where an application is brought for directions against a background of hostility between a trustee and beneficiary, the case does not neatly fall into Buckton category (1) rather than (3)." But a beneficiary is not deprived of, or ordered to pay, costs merely because he unsuccessfully opposes, even strongly opposes, the trustee's application. Beneficiaries who support the trustee's application are not deprived of costs merely because there is some duplication between their arguments and those of the trustee. An application may be made for a prospective costs order in respect of the costs of trustees or beneficiaries of an application to the court for directions concerning the administration of the trust." 33. His client's position was that the Trustee had made a decision in principle in 2018, which decision was reaffirmed by the decisions in 2023, 2024 and 2025.

34. He also referred to the Court's finding in the Main Judgment that it could not see anything that amounted to a volte face on the part of the Trustee .

35. Advocate Lacey in reply emphasised that the conduct of C and D was unreasonable in trying to walk away from the Heads of Terms.

36. There was also nothing unfair in making orders against C and D because of C's wealth. Discussion and decision on costs 37. As Advocate Lincoln contended (and the other parties did not disagree), the correct starting point is the Alhamrani decision at paragraph 39 which states as follows in relation to the Trustee costs: "39 As a matter of law, therefore, the trustee is entitled to be reimbursed for the expenses and liabilities that he has reasonably incurred in connection with the trust. The concept of "reimbursement" implies full repayment and the authorities in England have always made it clear that a trustee has the right to full reimbursement of his expenditure properly incurred on behalf of the trust." 38. In Re Y Trust [2011] JRC 155A , Commissioner Clyde-Smith stated the following at paragraph 10 and 11: "10. As a matter of general principle a trustee is entitled to an indemnity out of the trust fund in respect of costs and expenses properly incurred by him in connection with the performance of his duties and exercise of his powers and discretions as a trustee but a trustee can be denied an indemnity for its costs if it is found to have acted unreasonably (see In the matter of ELO and R Trusts [2008] JRC 150 ). It was accepted by Mr Robertson that this was a high hurdle. As stated at paragraph 21-64 of Lewin:- "A trustee may be deprived of costs, or ordered to pay

costs, not only by reason of his conduct which occasioned the proceedings, but also by reason of his unreasonable conduct in bringing unnecessary trust proceedings, or his conduct in the proceedings themselves, for example by taking procedural steps which needlessly increase costs by acting in a partisan manner to some beneficiaries against others, by adopting an excessive role in trust proceedings by contesting claims which ought to be contested by others not the trustees or which ought not to be contested at all. If the Court, upon the question of costs being drawn to its attention, makes an order that the judge does not think fit to make any order as to costs, that is an order depriving the trustee of costs and disentitling him from indemnity, and so preventing him from claiming a right of indemnity under the general law." 11. A beneficiary convened to an administrative application can be at risk as to costs as made clear in Lewin at paragraph 21-85:- "In a case where a trustee makes an application for directions in consequence of the conduct of a disaffected beneficiary intent on disrupting the administration of the trust, the beneficiary is at risk at least of being deprived of his costs and at worst of being ordered to pay all the costs of the application which was made necessary by reason of his conduct. But a beneficiary who makes a bona fide claim against the trustees

in third party proceedings should not, it is thought, be deprived of costs (nor be ordered to pay costs) of the Beddoe application, by reason only that he has commenced the claim and therefore necessitated the Beddoe application. Such a beneficiary might, however, become at risk as to costs if he adopts an excessive role in the Beddoe application and seeks to use it as a forum for promoting his claim in the third party proceedings. An application may be made for a prospective costs order in respect of the costs of trustees or beneficiaries of an application to the court for directions concerning the administration of the trust."" 39. In the present case, there is no question of the Trustee having acted unreasonably. The only question in relation to the Trustee's costs is therefore whether they are paid out of the trust fund before any distribution to the beneficiaries or whether they are borne in whole or in part by C and D.

40. The above extract from Lewin is merely an earlier version of the extract cited by Advocate Lincoln set out at paragraph 32 above.

41. I firstly deal with the costs of the Preliminary Issue. The Heads of Terms signed by the parties post-date the Preliminary Issue Judgment by nearly fourteen months. Clause 13 of the Heads of Terms reached the following agreement: "13. In full and final settlement of all issues as to costs to date , the Parties agree that - 13.1. [B]'s and [A]'s legal costs to date, including those of the Trustee's Representation dated 15 August 2019, may be reimbursed from their respective shares of the available cash; 13.2. [D]'s and [C]'s legal costs to date, including those of the Trustee's Representation, may be reimbursed from their one third share of the available cash; and 13.3. The Trustee's costs to date, including those of the Trustee's Representation, be borne in equal shares by (i) [B], (ii) [A] and (iii) [C] and [D]." (emphasis added) 42. [Redacted].

43. Given the parties reached agreement on costs, which covers all costs up to the date of the Heads of Terms, I see no reason to interfere with that agreement. B and A had the benefit of legal advice at the date of entering into the Heads of Terms. They have not therefore met the threshold that this Court should interfere with an agreement voluntarily reached to settle various disputes, including the costs of the Preliminary Issue proceedings.

44. In relation to the costs incurred by the Trustee and the beneficiaries, since the Head of Terms, there is force to the submissions of Advocate Kistler that beneficiaries should be able to advance their views and, simply because the Court disagrees with the views advanced, does not mean that a beneficiary should be deprived of their costs.

45. In addition, as Advocate Kistler also contended, while the Trustee had reached a preliminary decision in 2018, the Trustee was reevaluating that decision in light of the tax advice it had received from [redacted]. The statements made by Mourant on behalf of the Trustee to B and A referred to at paragraphs 20 and 27 are therefore pertinent. The conclusion I have reached therefore is that it would be wrong to penalise C and D while the Trustee was still considering matters.

46. However, by reference to the chronology set out in the Main Judgment, by 9 September 2024, the Trustee wrote to Carey Olsen stating that in its view the Trustee was unable to identify any matters which had not already been considered and that its tax advisor had confirmed that nothing raised by Carey Olsen in their letter dated 22 July 2024 to Mourant had changed their analysis. The Trustee therefore made it clear that it saw no reason to depart from the in principle decision taken on 21 November 2023 (see paragraph 51 of the Main Judgment).

47. Notwithstanding this clear statement, C and D resisted the blessing application and contended that the Court should not approve the decisions taken by the Trustee, culminating in the Trustee 2025 Minute. In my judgment, this approach from September 2024 onwards went beyond C and D simply challenging the tax advice. They had the choice at that point, all their concerns having been considered, to have accepted the Trustee's decision. Instead, they chose not to do so and opposed the blessing application. Yet the material on which they relied, it having been considered by the Trustee in detail, came nowhere near establishing any basis to show that the questions the Court was required to consider (see paragraph 167 of the Main Judgment) were not going to be met and the application refused.

48. The Court also concluded that C and D were trying to have it both ways (see paragraph 186 of the Main Judgment). I do not accept the attempt by Advocate Kistler to water down this finding.

49. What does this mean in terms of costs? The conclusion I have reached is that C and D should meet the costs of the Trustee and of the beneficiaries from 1 October 2024. I have taken this date because this allowed them an opportunity to consider the response of Mourant sent on 9 September 2024. However, instead on 2 October 2024, Carey Olsen wrote to Mourant disagreeing with Mourant's response.

50. I consider that these costs should be paid on the standard basis, not the indemnity basis. The Trustee was always going to have some further work in order to bring the matter back to Court for approval of the approach it wished to take. There was also some limited benefit to the discussion before the Court in relation to the provision of indemnities and insurance cover which militates against making an order for indemnity costs.

51. In relation to costs prior to 1 October 2024, the Trustee's costs will be paid out before any distribution to any of the branches and each family lines' costs shall be paid out of their share. Referring to this judgment in the Country 1 proceedings and publication 52. I next turn to deal with the question of how far this judgment might be referred to by any party in the Country 1 Proceedings and its publication. This issue arose during the oral hearing relating to costs and I directed the parties to file written submissions in relation to this question.

53. The starting point is that generally this Court will publish decisions on an anonymised basis to protect the identity of beneficiaries and confidential information about their affairs.

54. If confidentiality cannot be protected, because there are ongoing issues which the Court still needs to determine, the Court will frequently publish judgments as between the parties only with a view to publishing them later on a redacted basis once matters have been concluded. At times where information said to be confidential is in the public domain, this Court faces the difficult task of not publishing a judgment at all or publishing without any redactions, including identification of the parties (see HSBC Trustee CI v Kwong [2018] JRC 051A and the discussion at paragraphs 16 onwards, in particular paragraphs 40 to 48).

55. Advocate Kistler also contended by reference to Trilogy Management Limited v YT Charitable Foundation (International) Limited and Others [2014] JRC 182 , where the Court considered the circumstances in which material that was available to private proceedings in Jersey might be disclosable in public proceedings elsewhere, in that case, in England. At paragraphs 3 and 4, Commissioner Herbert stated the following: "3. ..... Basing myself principally on three decisions of the Royal Court, namely Enhörning v Nordic Link (unreported, 24 January 1997), in which the Court cited an important passage from the Australian case Springfield Nominees Pty Limited v Bridgelands Securities Limited (1992) 110 ALR 685, 693, Westbond International Bank v Cantrust (CI) Limited [2004] JRC 111 and In the matter of the M and other trusts [2012] (2) JLR 51, the main conclusions were summarized in paragraph 32:- (i) It is accepted that the application is made in good faith, and that there are likely to be documents capable of assisting Trilogy to achieve justice in the new proceedings. (ii) It is for Trilogy to identify which particular documents, or possibly specific descriptions of documents, it needs in order to plead and make good its case in the English proceedings, and to demonstrate that need to the Court. (iii) If the Court's order is to give permission by reference to categories of

documents, as opposed to specific documents, it will expressly limit its permission to documents relevant to the issues in the new proceedings. (iv) If documents are such as to disclose the nature and result of the 2010 action, permission will not be given to use those documents unless the Court is satisfied that no harm will come from that disclosure. (v) The Court will also need to be satisfied of the criteria for permitting documents disclosed under the implied undertaking to be used against third parties. (vi) The order will expressly provide that its permission does not authorize the use of documents protected by legal professional privilege.

4. In short, the task of the Court can be summarised in this way - to consider the criteria identified in the Springfield case, namely the nature and provenance of the document in question, its forensic value in the proposed litigation, and the importance of the privacy imposed by the court; to avoid disclosing the nature and result of private proceedings; and to avoid harm to the trust in question and its assets." 56. In this case, what the Court decided in the Main Judgment was to bless the decision of the Trustee. This does not involve any findings of fact between the parties. Rather, as set out in the Main Judgment at paragraph 168, the central issue is whether the Trustee's decision is one that a trustee properly instructed could have reached or whether it was irrational. This Court is therefore not resolving disputed questions of fact based on witness statements and cross-examination in reaching such a conclusion.

57. I have set this out for the benefit of the Country 1 Court to the extent that either party seeks to contend that the Royal Court has already determined certain factual matters.

58. Equally, it is also right to recognise that certain material before this Court solely related to the affairs of the Trust. As noted in the Preliminary Issue Judgment at paragraphs 29 -33 cited in the Main Judgment at paragraph 28, there was an effective separation between issues that were before this Court leading to the Main Judgment and issues in dispute in Country 1. Any findings in Country 1 were not determinative of the key issues for the Trust.

59. The observation I wish to add is that the same is true in reverse, namely any conclusions of the Jersey Court in the Preliminary Issue Judgment or the Main Judgment do not go and are not determinative of the key issues for the Country 1 Court.

60. The approach I have taken therefore applying the general principles relating to publication of judgments is that the judgment should be published in the normal way and should be redacted so that third parties should not be able to identify the beneficiaries of the Trust.

61. In this case however the Main Judgment contains detailed confidential information about the tax position of the Trust and certain beneficiaries . I have determined that the tax advice contained or referred to in the Main Judgment, whether obtained by the Trustee or by C and D, should also be redacted. This is advice relevant to the affairs of the Trust and any tax liabilities that the Trustee and certain beneficiaries might face. It is not relevant to the issues in Country 1 as I understand them. I therefore do not consider this advice should be referred to in the anonymised judgment or should be put before the Court in Country 1. It is only there for the purposes of the blessing sought by the Trustee and given the separation of issues between Jersey and Country 1 to which I have referred, the detail of that advice (as distinct from it having been obtained and considered) should not be referred to in the public domain or in the Country 1 proceedings. The threshold referred to in Trilogy has not been met.

62. I therefore vary the privacy order to this extent. The Country 1 Court is entitled to know the conclusions this Court has reached and the basis upon which we have reached our conclusions but, with respect to the Country 1 Court, the detailed tax advice obtained by the Trustee and shared with the beneficiaries is confidential to the Trustee and the beneficiaries and should remain so. A draft of the proposed redactions will be sent to the parties for comment at the same time as this judgment.

63. I also request the Country 1 Court to, as far as possible, reflect the privacy order made by the Court and not to make any reference to the detail of the Preliminary Issue Judgment or the Main Judgment so as to reveal the identities of the beneficiaries. How the Country 1 Court deals with that is a matter for the Country 1 Court. The beneficiaries are however directed by this Court to not to refer to any parts of the Preliminary Issue Judgment or the Main Judgment in the Country 1 Proceedings that have been redacted for publication apart from the names of the beneficiaries. Authorities Representation of Oak Trustees (Jersey) Limited re X Trust [2026] JRC 026 In the Matter of The Piedmont Trust [2022] 1 JLR 157 . Erinvale Ptc Limited [2022] JRC 076. In the matter of the Piedmont Trust [2021] JRC 250 . Alhamrani v JP Morgan Trust Company (Jersey) Limited [2007] JLR 527 . Lewin on Trusts Re Y Trust [2011] JRC 155A .

HSBC Trustee CI v Kwong [2018] JRC 051A . Trilogy Management Limited v YT Charitable Foundation (International) Limited and Others [2014] JRC 182 . Page Last Updated: 28 Apr 2026 BAILII: Copyright Policy | Disclaimers | Privacy Policy | Feedback | Donate to BAILII