Re The Hanover Trust [2013] SC (Bda) 38 Civ

Analysis

A trustee (T) of Bermudian trusts applied to the Bermudian court by an originating summons for directions. The originating summons named the settlor and principal beneficiaries as defendants. The application invoked the Bermudian court’s supervisory jurisdiction over Bermudian trusts.

The issue arose as to whether T needed leave to serve the originating summons on four overseas resident defendants.

Held:

1. 1) Leave for service of an originating summons out of the jurisdiction is not required for non-contentious applications by Bermudian trustees for directions relating to the administration of a trust.
2. 2) Directions dispensing with the need for T to obtain leave to serve the originating summons on the defendants out of the jurisdiction, directing that they could be served by air courier at their last known address on the grounds that the character of T’s action was such that no need to seek leave to serve out under Order 11 arose.
3. 3) Section 9 of the Trusts (Special Provisions) Act 1989 gives the court jurisdiction to hear applications in respect of a trust. Section 9 ought to be read with Order 85 of the rules. Order 11 rule 1(2) is only engaged when the nature of the proceedings is an adversarial one involving a claim against a party resident abroad.
4. 4) Order 11 and the need for leave to serve out only arises where an adverse claim is asserted against a foreign substantive defendant who may potentially query whether:
5. a) The court possesses subject matter jurisdiction over the dispute under Order 11 rule 1(1) and/or
6. b) Whether Bermuda is the most convenient forum applying the common law rules developed in relation to Order 11 rule 4(2).
7. 5) A breach of trust claim brought by Bermudian trustees against a foreign defendant would be the sort of claim to which Order 11 would potentially apply. However, because of the impact of s9 as read with Order 11 rule(2), leave to serve out would not be required as regards such an originating summons either.
8. 6) The general rule for service appears to be that personal service within or without the jurisdiction will not ordinarily be required. Greatest flexibility in terms of the way proceedings are brought to the attention of interested parties will likely exist in relation to applications for directions which are not likely to result in any adverse order against beneficiaries or interested persons. The position in relation to service abroad on defendants to a breach of trust claim may require more careful scrutiny.

Introductory [1] On 7 February 2013, the trustee applied for directions in relation to the trusts (all established in Bermuda) by an originating summons which named the settlor and principal beneficiaries as defendants. The application was prompted by the fact that relations between the trustee and the settlor had broken down and the trusts were …

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