Discretion of Trustees

Where the Trust Deed confers a power on the trustee(s) it should be the trustee(s) – and no one else – who should decide how the power should be exercised.

A trustee must not act under the dictation of third parties.

In some Trust Deeds an “absolute discretion” clause is added such as:

The trustees may ……in such manner as they may in their absolute discretion thin fit.

However such a clause has no effect whatsoever.

If trustees act improperly they may be restrained by the court even if their powers are said to be ‘uncontrollable’.

{Re Gulbernkain [1970] AC 508; Harris v Lord Shuttleworth [1994] ICR 991}

Conversely beneficiaries cannot control trustees acting properly.