Abstract:
This article analyses the different categories of letters of wishes, their different implications on the trustee’s duty, the comparative judicial approaches to the recognition and treatment of letters of wishes, as well as the offshore statutory models governing the trustee’s duty of disclosure. This article argues that, whilst the law is less than certain, a resort to statutory reform is unnecessary. It is argued that the current position on letters of wishes, post-Rosewood, is that of a judicial discretion based on the court’s inherent duty to supervise the trust, shifting the emphasis in the law to the trustee’s accountability. This shift to accountability is consistent with the obligational theory of trust. It is argued that this does not represent a complete shift to accountability. Instead, the court must still undertake a balancing exercise – between the trustee’s duty to account that entitles the beneficiaries to inspect trust documents and records on request, and the trustee’s duty to act in the best interests of the beneficiaries that requires the trustee to reject a request for disclosure in appropriate circumstances – in deciding whether the trustee has disclosure obligations on a letter of wishes towards the beneficiaries.