LOCAL trust law is likely to be significantly impacted by a Privy Council judgement to overrule a decision made by the Guernsey courts.

The decision, which related to the effect of a clause in a long-established Guernsey trust deed seeking to exonerate the trustees from liabilities such as gross negligence, saw the judicial committee of the Privy Council rule that trustees can be exonerated from their own gross negligence without breaking their duties to act as a good father of a trust.

The Royal Court of Guernsey and the Guernsey Court of Appeal had previously ruled that it was incompatible for a trustee to act as a good father while exonerating itself from its own acts of gross negligence by a provision in the settlement deed.

Carey Olsen managing partner Advocate John Greenfield (pictured), who is acting for the beneficiaries, said the ruling moved Guernsey very much into the territory of English trust law.

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