Direct disclosure obligations resulting from joinder of adult beneficiaries to matrimonial proceedings affecting trusts

In its briefing of October 2013 entitled ‘Joinder of adult beneficiaries to matrimonial proceedings affecting trusts — Tchenguiz-Immerman v Immerman’, Mourant Ozannes discussed an application by three adult beneficiaries of certain offshore trusts who were joined as parties to financial remedy proceedings in England despite having previously supported the decision of four trust companies (the ‘trustees’) not to participate. As a result of joinder, the English Family Division made an order requiring the beneficiaries to disclose copies of documents that had been provided to them for the purpose of the application made by the trustees to the Royal Court of Jersey and the Eastern Caribbean Supreme Court for approval of their decisions not to participate, in spite of a request from the Jersey court not to order such disclosure.

The trustees had previously applied to the Royal Court of Jersey and the Eastern Caribbean Supreme Court for (and obtained) those courts’ respective approval of their decisions not to participate in the English financial remedy proceedings, supported by the beneficiaries. The trustees provided some information about the 10 discretionary trusts but declined to provide a considerable part of the information and documents sought by the wife and, it appeared, were not willing or were unlikely to be willing to provide evidence as witnesses.

The beneficiaries subsequently successfully applied to be joined as parties to the financial remedy proceedings, with the court concluding that there were considerable advantages to the direct participation of the beneficiaries as it would assist with investigation and resolution of matters in dispute. The beneficiaries would also be subject to direct disclosure obligations and cross examination, as well as being entitled themselves to cross-examine other witnesses and parties…

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