Deery v Continental Trust Company Limited and Watts [2010]JRC001

The Royal Court declines to assist the Family division of the High Court in relation to a matrimonial dispute involving a Jersey trust.

Mr and Mrs Deery’s marriage had come to an end. Matrimonial proceedings were heard before the Family Division of the High Court in England. In connection with those proceedings, the English court issued a Letter of Request to the Royal Court in Jersey, a formal process by which the English Court seeks the assistance of an overseas one.

In this case, an Order had been made in the English Court (with the support of the trustee of a Jersey trust) to the effect that a sum would be paid to the Wife from the trust assets. No such payment had been made. Therefore, apparently in order to assist the Wife in securing enforcement of that Order, the English Court requested the Royal Court to require the attendance of the trustee before the Royal Court, accompanied by two of the trustees affidavits to which reference had been made during the matrimonial proceedings. The object of the exercise appeared to be that those affidavits would be provided to the Wife’s lawyers to assist with enforcement.

The Royal Court started from the position that it should, where possible, give assistance where a Letter of Request was received from a Court in another recognised jurisdiction. It should depart from that starting point (following the Jersey authority of Wadman v Dick) ‘only in so far as it is not proper or permissible or practicable under its own law to give effect to’ the Request.

However, having heard from the trustee’s representative in the absence of the Wife’s Jersey lawyer, the Royal Court declined to act on the Letter in this case. The rationale for that refusal was as follows  - a trustee must feel able to come before the court for Directions under Article 51 of the Trust (Jersey) Law 1984. In so doing a trustee had a responsibility to place before the Court affidavit evidence setting out matters in relation to the trust in a full and frank manner. If a trustee feared that such affidavit evidence might subsequently be disclosed to ‘those with hostile eyes’, the trustee might be less candid, and the whole purpose of an Article 51 application might be defeated. For that reason applying the law of Jersey the Deputy Bailiff did not feel it ‘proper’ to give effect to the Letter of Request in this case.

Nor were the Letters in proper form and the usual process for placing them before the Royal Court had not been followed.

Furthermore the Royal Court declined to adopt a blue pencil approach – in other words, the Court was not prepared to strike through those elements which it felt were inappropriate or inaccurate, and thereafter give effect to the Letter of Request as to part only of its content. This despite the fact that in Wadman v Dick the Court had concluded that ‘the Court may amend Letters of Request by excision, or by adding or substituting words in order to clarify what is being sought without altering the substance of the Letters of Request.’

Why is the case worthy of note?

Some Trust practitioners in Jersey have expressed concerns at the apparent readiness of the Royal Court to support and enforce Orders of the English Court in relation to Jersey trusts governed by Jersey Law; and to allow access to otherwise confidential information in relation to the same, usually in the context of matrimonial proceedings. Had that been the case, the outcome of this case would have been different. The Royal Court declined to give effect to the Letters of Request, and notably did so on the basis of, amongst other reasons, what might be described as ‘merely’ technical or procedural deficiencies in those Letters. ‘The Royal Court makes rules for a purpose and it is to be expected that the rules therefore will be complied with.’