Knowledge

In a judgment handed down on 11 November 2025, the Royal Court of Guernsey (the "Court") considered a former trustee's entitlement to remuneration and expenses in Geneva Trust Company (GTC) S.A. v Orbitus Trustees (Guernsey) Ltd [2025] GRC 087. This was the first reported decision applying section 35 of the Trusts (Guernsey) Law, 2007 (the "Trusts Law"), which provides the Court the ability to approve trustee remuneration.

In this case, and somewhat unusually, Geneva Trust Company ("GTC") had provided a "caretaker" role under a Court of Appeal order following its removal as trustee and pending appointment of a new trustee.  The periods for which GTC claimed remuneration and expenses could be divided into three phases:

• the period prior to its removal;
• the period following removal, but prior to appointment of a replacement trustee under the Court of Appeal order; and
• the period following appointment of a replacement trustee, but before certain assets had been transferred to the new trustee.

For the first period, GTC had failed to publish terms and conditions that would otherwise have adequately set out the terms in accordance with which it should be remunerated. The Bailiff considered an earlier decision of the Court as being helpful, and reached the conclusion it was open to the Court under section 35 of the Trusts Law to determine and make order for remuneration.

Whilst not an equivalent to a "course of dealings" argument, in examining the facts the Court noted there was a presumption that the same approach as had been taken in the early years of the trusteeship should be applied up to removal. Indeed, a pattern of conduct by payment was noted in the evidence. As a result, GTC was entitled to its remuneration and expenses in full for the whole period up to removal. The Bailiff did note that if only GTC had published its terms and conditions, then much of this dispute would not have been required - a useful warning to trustees to keep their terms up to date.

For the second period, GTC had been specifically tasked by the Court of Appeal with preserving the assets of the trust pending appointment of the new trustee. The Bailiff determined that GTC should be entitled to its remuneration and expenses following removal and up to appointment of the new trustee. Given the wording used by the Court of Appeal, however, the Bailiff indicated that these fees and expenses might be subject to greater scrutiny than those for the first period in order to ensure that they were limited to preservation of trust assets.

During the third period, a new trustee had been appointed, and so GTC's role changed again. It was conceded that once a trustee has been removed from office (and in the absence of further order) that it is not entitled to remuneration - that position contrasts with claiming expenses reasonably and properly incurred such as payment to maintain underlying companies in good standing. The Bailiff followed the principle established in In re H. Sossen 1969 Settlement (unreported, 28 May 2004; 2003-04 GLR Note 18) and applied by Lieutenant Bailiff Talbot in the In re Tchenguiz Discretionary Trust (unreported, 18 December 2015) and In re Tchenguiz Discretionary Trust (2017 GLR 13) decisions. He confirmed that remuneration could not be claimed once a trustee was out of office, but there was no block on a former trustee making a claim for recovery of any expenses reasonably incurred in the period after their removal.

The Bailiff's judgment also addressed a few issues concerning insolvency and attempts to reduce remuneration and expenses claimed by reference to the alleged "precarious nature" of the trust property. However, having set the principles to be applied the Bailiff left the parties to seek to address those points on another occasion, if required.

In the meantime, the judgment provides some helpful clarification for former trustees in relation to how to approach remuneration, including seeking early clarification of its position from the Court if necessary. In the event that a trustee cannot rely on published terms and conditions, this provides confirmation that the Court can assist in securing remuneration, although prevention is better than cure in these matters.