Clarke v Clarke's Trustees [1925] ScotCS CSIH_3 (16 June 1925)

Clarke v Clarke's Trustees [1925] ScotCS CSIH_3 (16 June 1925)

Trustees were in breach of trust for failing to monitor and realise depreciating tramway shares and for not setting aside and investing funds to secure the widow's annuity; indemnity clause did not excuse negligence; statutory relief under section 32 of the Trusts (Scotland) Act 1921 was not available as trustees' conduct was not reasonable, though honest.

Citation
[1925] ScotCS CSIH_3
Parties
Pursuer: Clarke; Defender: Clarke's Trustees
Jurisdiction
Scotland
Judgment Date
16 June 1925
Procedural Posture
Action of Count, Reckoning, and Payment / Appeal (reclaiming Notes) Before the Inner House
Outcome
Trustees held liable for loss on tramway shares and for failure to invest funds for widow's annuity; objections by pursuers otherwise repelled; decree issued accordingly.
Legal Topics
Trustee Duties, Breach of Trust, Investment of Trust Funds, Trustee Immunity, Trusts (scotland) Act 1921, Distribution of Estate, Provision for Annuities
Trusts and Estates Property Law Trustee Duties Breach of Trust Investment of Trust Funds Trustee Immunity Trusts (scotland) Act 1921 Distribution of Estate +1 more

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Parties

Clarke

Pursuer

Clarke's Trustees

Defender

Procedural Posture

Action of Count, Reckoning, and Payment / Appeal (reclaiming Notes) Before the Inner House

Legal Issues

  1. 1 Whether trustees were negligent in retaining depreciating tramway shares
  2. 2 Whether trustees breached trust by failing to invest funds to secure widow's annuity
  3. 3 Whether trustees should be relieved from liability under section 32 of the Trusts (Scotland) Act 1921

Ratio Decidendi

Trustees were in breach of trust for failing to monitor and realise depreciating tramway shares and for not setting aside and investing funds to secure the widow's annuity; indemnity clause did not excuse negligence; statutory relief under section 32 of the Trusts (Scotland) Act 1921 was not available as trustees' conduct was not reasonable, though honest.

Court Disposition

Trustees held liable for loss on tramway shares and for failure to invest funds for widow's annuity; objections by pursuers otherwise repelled; decree issued accordingly.

Orders

  • Trustees to account for and restore £250 loss on tramway shares to relevant beneficiaries.
  • Trustees to account for loss of interest on £5000 not invested for widow's annuity to relevant beneficiaries.