Arbitration In Trust Disputes – A Cayman Islands Perspective

The use of arbitration to resolve trust disputes is gaining momentum in offshore jurisdictions and the Cayman Islands is poised to emerge as a progressive forum for trust arbitration. Following the enactment of the Arbitration Act in 2012, Cayman has seen a growing interest in incorporating arbitration clauses into trust deeds as settlors and trustees seek more private, flexible and efficient dispute resolution mechanisms. However, there still remains considerable scepticism as to whether trust disputes are capable of resolution by arbitration, with concerns raised by jurisdictions that are yet to introduce statutory framework governing the resolution of trust disputes by arbitration as well as jurisdictions that have enacted legislation and significant complexities and limitations have arisen in the course of arbitration.