chapter  16
70 Pages

Breach of trust

ByMohamed Ramjohn

A trustee is liable for breach of trust if he fails to perform his duties, either by omitting to do any act which he ought to do, or by doing an act which he ought not to do. Such duties may be created by the settlor in the trust instrument or may be imposed generally in accordance with trust law. Trustees' liability for breach of trust is based on the principle of restoring to the trust estate losses connected with trust assets and funds that the trustees wrongfully dealt with in breach of trust. Relief under section 61 is often described as an exercise of mercy by the court. Where a fraudster deceives both the purchaser's and vendor's solicitors and receives the purchase monies by impersonating the true owner of property so that the purchase was incapable of completion and the fraudster absconds with the funds, both firms of solicitors may be liable for breaches of trust.