ABSTRACT
CAPSULE SUMMARY A trustee will be liable for breach of trust if that breach of trust causes a loss to the beneficiaries. Such a trustee will be liable in the event of a breach of trust either to restore the trust property which was passed away in breach of trust or, if that is not possible, to reconstitute the value of the trust fund in cash to its level before the breach of trust, or to pay equitable compensation to the beneficiaries. 1 A trustee will be liable in the situation in which the breach of trust has caused some loss to the trust. 2 There will be no liability in respect of a breach of trust where that breach resulted in no loss to the trust. 3 The measurement of compensation will be the actual, demonstrable loss to the trust, rather than some intermediate value of the property lost to the trust. 4
18.1.1 The liability of trustees within the context of breach of trust more generally
This chapter considers the liabilities of the trustees of a trust for any breach of trust. That breach of trust may arise under the terms of the trust instrument specifically or under the law of trusts generally. There is a broader context to the law dealing with breach of trust, however, which it is useful to understand from the outset. The law of trusts offers litigants a uniquely broad range of remedies, which is part of the reason why some commercial people choose to use English trusts to organise their property management because they have so many remedies available to them.
