The Trusts (Jersey) Amendment Law 2026: a welcome update for trustees, beneficiaries and secured creditors

Jersey has reinforced and strengthened its reputation and position as a leading trust jurisdiction with the passing of the Trusts (Jersey) Amendment Law 2026.  

The legislation builds on recommendations from the Trusts Law Working Group to modernise the Trusts (Jersey) Law 1984 (the Trusts Law), bringing greater clarity and certainty for trustees, beneficiaries and lenders in an ever evolving and increasingly competitive international market.  

The key changes within the Trusts (Jersey) Amendment Law 2026 (the Amendment Law) include: 

• clarifying that a sole trustee cannot resign without a successor being appointed 
• providing that the rule in Saunders v Vautier (as provided for under article 43(3) of the Trusts Law) shall not apply where there is a power to add beneficiaries or charitable beneficiaries 
• confirming the priority of a secured lender’s interest in or over trust property compared to a trustee’s lien 

Resignation of a sole trustee

The Amendment Law revises article 19 of the Trusts Law, which addresses trustee resignation and removal, by adding article 19(3A): 

“If a sole trustee purports to resign, the effect of which would mean that there would be no trustee, the resignation has no effect.” 

While this amendment reflects established practice in Jersey, it is helpful for the position to be reinforced by this new statutory provision. In particular, the new provision is designed to avoid uncertainty for sole trustees, especially those who are not professionals. It mirrors the existing article 19(3), which prevents multiple trustees from simultaneously resigning if this would leave the trust without any trustees. 

Priority of secured creditors over a trustee’s lien 

The Privy Council decision in Equity Trust (Jersey) Limited v Halabi (as Executor) [2022 UKPC 36] and ITGL v Fort Trustees [2022] UKPC 36 confirmed that trustees (and former trustees) have both a right of indemnity and a proprietary interest (the trustee’s lien) in trust property. 

Uncertainty has persisted regarding the interaction between trustees’ liens and security interests granted over trust assets, particularly when former trustees are involved. The Amendment Law now provides that a lender’s secured interest takes priority over any trustee’s (or former trustee’s) lien, unless otherwise agreed. 

Article 43A of the Trusts Law will now state that: 

“An interest in or over trust property, granted or created at any time by the trustee ... that secures the payment or performance of an obligation ... takes priority over any lien arising in favour of the trustee or former trustee by operation of law, unless the secured party agrees otherwise.” 

This statutory clarification aligns with what trustees and lenders would typically expect when entering into a secured lending arrangement. The clarification is expected to be a welcome addition for lenders, who will be grateful that the statute now includes an express provision regarding the priority of a secured interest, removing doubt. Trustees are also likely to welcome the clarification as it should ease the process of obtaining funding from secured lenders.  

The amendment is particularly pertinent for Jersey Property Unit Trusts (JPUTs) which are typically used to acquire and hold interests in UK commercial real estate. Differing forms of security may be granted by the trustee of the JPUT to banks to ensure funding (for example, an English law legal charge over the UK situs property). The fact there is now certainty that such forms of security granted by the trustee of a JPUT to a lending bank will take priority over a trustee's lien is to be welcomed. 

Retiring and former trustees should be aware that a secured interest may create priority over any lien they may have over the trust property. 

Right of beneficiaries to call for trust termination 

The present article 43 of the Trusts Law sets out the statutory basis for the rule in Saunders v Vautier which provides that all the adult beneficiaries of a trust may together call for the trust’s termination and for the trust’s assets to be distributed between the beneficiaries. This provision is currently limited to circumstances in which (i) all of the beneficiaries are in existence and have been ascertained and (ii) none of the beneficiaries are minors or interdicts. 

Traditionally, in Jersey, the presence of a power to add beneficiaries has prevented existing beneficiaries from collectively terminating a trust. The rationale for this being that where there is a power to add beneficiaries, the class of beneficiaries is not closed and so it cannot be said that all beneficiaries are in existence and have been ascertained.  

In other jurisdictions, the so-called rule in Saunders v Vautier has been developed to provide that it will not apply where there is a power to add beneficiaries. However, the Guernsey case Rusnano Capital AG (in liquidation) v Molard International (PTC) Limited and Pullborough International Corp [2019] GRC011 cast doubt on this interpretation of the relevant Guernsey statutory provisions. It was noted that principles developed in other jurisdictions are not necessarily applicable as to how the statute ought to be interpretated. 

The Amendment Law therefore amends article 43 of the Trusts Law, inserting a new paragraph 43(3A), which clarifies that if additional persons could become beneficiaries, or if property may be applied for a charitable or non-charitable purpose, the beneficiaries cannot unilaterally terminate the trust. This amendment brings Jersey's statutory codification of the rule in Saunders v Vautier into line with how this rule has been developed under English law. 

Limited Liability Companies as trustees

Finally, the Amendment Law amends articles 2, 3, 4 and 6 of the Trusts Law to confirm that a Jersey Limited Liability Company may act as trustee of a Jersey trust. 

How Ogier can help 

The changes brought by the Amendment Law enhance an already robust statutory framework, demonstrating Jersey’s ongoing commitment to clarity, certainty and competitiveness in trust law.  

For more information on these changes to the Jersey Trusts Law or for bespoke advice regarding a Jersey trust, reach out to a member of Ogier’s Trusts Advisory Group. 

Ogier’s Trust Advisory Group offers specialised expertise and a dedication to excellence. Our highly skilled experts are adept at navigating the complexities of trust law across multiple jurisdictions, ensuring our clients receive the highest standard of service and advice. With a comprehensive understanding of the offshore trusts' framework and the practical implications of recent developments, we provide tailored solutions to meet your unique needs.

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Disclaimer

This client briefing has been prepared for clients and professional associates of Ogier. The information and expressions of opinion which it contains are not intended to be a comprehensive study or to provide legal advice and should not be treated as a substitute for specific advice concerning individual situations.

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