The Role of The Court ‘Blessing Applications’

/ trusts

Trustees are often required to make important decisions in relation to trusts. Court approval is sometimes necessary for ‘momentous’ decisions by way of a ‘blessing order’ application before acting upon such decisions. Court approval will usually protect trustees from a future allegation of breach of trust.

There is little guidance on what amounts to a ‘momentous’ decision but generally it is one that will be of significant consequence to the trust. Examples include:

  • the sale or disposal of a major trust asset;

  • removal of a beneficiary;

  • winding up the trust.

The court has a supervisory role in the administration of trusts and it is not for the court to impose its own view of the advantages of a decision but rather whether the trustee’s decision is one which a reasonable trustee could properly have reached. Public Trustee v Copper [2001] sets out the test the court will apply in determining whether or not to bless a trustee’s decision:

  1. Is the trustee making the proposed decision in good faith?

  2. Is the trustee's decision one that a reasonable and properly informed trustee could make in the circumstances?

  3. Is the court satisfied that the opinion at which the trustee has arrived has not been impaired by any conflict of interest?

The purpose of a blessing application is not for the court to make the decision on the trustee’s behalf and, when applying to the court, the trustees must provide evidence of their decision making, as well as confirmation that they will act on their decision (subject to court approval). Beneficiaries and other interested parties are notified of the application and have the opportunity to make representations to the court about the application. 

If the court decides to bless the trustee’s decision, then the beneficiaries of the trust cannot seek to challenge that decision further down the line. It is imperative the relevant disclosure has been provided to the court in full. Supplementary evidence should be provided if new facts arrive. Failure to provide full disclosure opens trustees to attack that the decision was a breach of trust.

If you require information on the above, contact our private wealth and taxation team on 01494 521 301.