Orders Available Against Trustees: Beneficiary Loss Orders
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This paper consider whether Beneficiary Loss Orders should be available against trustees. Consider:
Beneficiary Loss Order: a court order obligating a trustee to pay money to a beneficiary, where the order is quantified with reference to the loss caused to the beneficiary by a breach of duty by the trustee.
Profit: Derek is obliged to pay any income from the trust estate to Philippa on the 1st January of every year. In 2019, Derek pays ten days late. This breach causes Philippa to miss an investment opportunity which would have led to a £15k profit.
A court’s making a Beneficiary Loss Order in Profit would obligate Derek to pay £15k to Philippa.
The paper is in two parts. The first part considers whether the legal authorities provide support for or against the availability of such orders. The second part considers whether normative arguments exist for or against the availability of such orders.
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