In October 2022 the Privy Council finally handed down judgment
in the Z Trust (II) appeals (ETJL v Halabi; ITGL v Fort Trustees
[2022] UKPC 36). This decision concerns the hitherto under examined
(and rather dull) topic of the nature and scope of the right of a
trustee to recover liabilities and expenses from the trust
assets.
Although both appeals concerned Jersey law, the decision will
have significance throughout the common law world. This is an
important decision for trustees and anyone dealing with a trustee
hoping to be paid from trust funds. It has particular importance in
circumstances where the trust fund is 'insolvent', ie,
where the trust's assets are insufficient to meet the amounts
due for reimbursement under the trustee's indemnity.
