Have you read the small print?

The recent court case of Re Clapham, Barraclough and Mell highlighted the serious issues surrounding trustee exemption clauses.

In this case the daughter of the deceased, acting as executor, paid half of her father’s estate to her nieces instead of to her brother-in-law who was entitled to it. The judge, despite being of the opinion that her conduct was probably grossly negligent, felt that he had no option but to exempt her from personal liability because her father’s Will contained a trustee exemption clause.

Trustee exemption clauses are commonly included in professionally written Wills and trust deeds, and they exclude a trustee’s liability for committing a breach of trust even if that breach is as a result of negligence.Where the trustee is a paid solicitor or accountant, this may be inappropriate.

The Society of Trust & Estate Practitioners has recently issued a new practice rule that requires its members to draw to a client’s attention the existence of a trustee exemption clause and to explain its effect when drafting any Will or trust deed for clients.

Should you have any questions about the nature and effect of a trustee exemption clause in your Will or trust deed, or to find out whether the document contains such a clause, please contact:

Sarah Albury
Tel +44 (0)20 7440 7042
sarah.albury@mishcon.com