Trustees may still be penalised in costs even where the court blesses their decisions: Y Trust  JRC 135
The Y Trust  JRC 135 case involved an application by the trustee for a blessing in relation to its decision to distribute the assets of the trust, which was inconsistent with its previous indication (described as a final decision) that the trust assets would be split 50 per cent for the benefit of the settlor’s eldest son (A) and 50 per cent for the benefit of the settlor’s younger son (B) as well as B’s three grandchildren and his grandchild. The Court sanctioned the decision to allocate A less than half of the trust assets as the decision was within the realms of rationality but stated that it was troubled by the manner in which the trustee had treated B.
At the time of the Trustee’s decision, which was subsequently sanctioned by the Court, the trust fund had sufficient funds to apportion £1.9 million to A, £0.5 million to B’s eldest child (C) and £1 million to a US trust for B’s remaining children and C’s daughter. After taking account of all the parties costs (a total of £492,500) there were insufficient funds in the Trust from which to make the final distributions. The question arose as to what extent the costs should be met from the Trust’s assets…
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