TRUSTS AND TRUSTEES — application for judicial advice — discretionary family trust — amendment to definition of distribution date in trust deed — power of amendment excludes amendments extending the distribution date beyond the latest date provided by the deed — distribution date defined as earliest of fixed period, royal lives period and early termination period — variation extending fixed period from 50 to 80 years — as amended, distribution date will still not exceed royal lives period — amendment permissible — trustee justified in administering trust on footing that amendment valid
Quick Take
1Where a trust deed defines the distribution date as the earliest of a fixed period, a royal lives period and an early termination period, and the power of amendment prohibits extending the distribution date beyond 'the latest date provided by' the deed, the royal lives period constitutes that latest date — an amendment extending the fixed period is valid provided the amended fixed period does not exceed the royal lives period as it stands at the time the amendment is made.
2The power of amendment in a trust deed is ambulatory, and what the deed 'provides' as the latest date must be assessed according to the circumstances existing at the time the power is exercised, not solely as at the date of execution of the deed.
3The royal lives clause in discretionary trust deeds of the 1970s–80s was included as a backstop to ensure compliance with the then-applicable rule against perpetuities, and on proper construction it determines the maximum permissible duration of the trust for the purposes of restrictions on the amendment power.
