May 2017
BERMUDA
SUPREME COURT
TRUST- CONSTRUCTION – WHETHER VESTING OF BENEFICIARIES’ INTERESTS EXTINGUISHES OVERRIDING POWER OF APPOINTMENT
By an Originating Summons, the Trustee sought an Order disapplying the perpetuity rule pursuant to Section 4 of the Perpetuities and Accumulation Act, 2009 and extending the duration of a Trust by 1000 years. Although the application was unopposed, Gilead Cooper, QC, provided an Opinion which made certain submissions that were adopted by Counsel for the Plaintiff Trustee.
The primary question for the Court’s consideration was where a beneficiary’s interest had vested, did the power of appointment in respect of that interest cease to exist? Following an analysis of the relevant clauses in the Trust deed, the Opinion of leading counsel and the main persuasive authority on the point (Howell & Others -v- Lees-Millais & Others [2009] EWHC 1754 (Ch)), the Court was satisfied that in this instance the overriding power of appointment did survive any vesting of capital and income.