15. Role of the Court in administration of Trust

(1) The Court may intervene in the administration of a Trust to the extent its jurisdiction is invoked by an interested person or as provided by law.

(2) A Trust is not subject to continuing judicial supervision unless so ordered by the Court.

(3) A judicial proceeding involving a Trust may relate to any matter involving the Tru

16. Jurisdiction of the Court

The Court has jurisdiction where:

• (a) the Trust is an AIFC Trust;
• (b) a Trustee of a Foreign Trust is an AIFC Participant;
• (c) any Trust Property of a Foreign Trust is situated in the AIFC but only in respect of Property so situated; or
• (d) administration of any Trust Property of a Foreign Trust is carried out in the AIFC.

17. Application to and certain powers of the Court

(1) A Trustee may make an application to the Court for direction or order concerning the manner in which he may or should act in connection with any matter concerning the Trust and the Court may make such direction or order, if any, as it thinks fit.

(2) The Court may if it thinks fit:

• (a) make an order concerning:

(i) the execution or the administration of any Trust;

(ii) the Trustee of any Trust, including an order relating to the exercise of any power, discretion or duty of the Trustee, the appointment or removal of a Trustee, the remuneration of a Trustee, the submission of accounts, the conduct of the Trustee and payments, whether payments into Court or otherwise;

(iii) the vesting of Trust Property;

(iv) a Beneficiary or any person having a connection with the Trust as the Court may determine; or

(v) the appointment or removal of an Enforcer in relation to any noncharitable purposes of the Trust;

• (b) make a declaration as to the validity or the enforceability of a Trust;
• (c) rescind or vary any order or declaration made under these Regulations, or make any new or further order or declaration; or
• (d) rectify the terms on an instrument creating or governing a Trust so that it conforms to the actual intentions of the party or parties to the instrument at the time of its execution as to either:

(i) its legal effect; or

(ii) its intended operation in the circumstances of the case.

(3) The Court may in any proceeding under this Part by order appoint a person to represent the interests of a person who the Court is satisfied is, or may become, a Beneficiary under a Trust, where:

• (a) the person is unborn; or
• (b) the Court is satisfied that the person is unable to act on his, her or its own behalf; and may by order remove such person and give directions as to service of such person.

(4) A person so appointed may represent the person whose interests he has been appointed to protect in any dealing with the Trust or in any proceeding under this Part.

(5) Where a representative has been appointed under subsection 17(3), no settlement affecting a person to whom subsection 17(3)(b) applies or the rights of Beneficiaries not yet in existence shall be valid without the approval of the Court.

(6) Subsections 17(4) and 17(5) shall apply irrespective of any provision in the Trust Instrument.

18. Payment of costs

The costs and expenses of and incidental to an application to the Court under these Regulations shall be paid out of the Trust Property or be borne and paid in such other manner or by such other person as the Court may order.

19. Sections 20 to 25: Interpretation

(1) In sections 20 (Application of powers under sections 21 to 25) to 25 (Applications and orders under sections 21 to 24):

1. (a) references to a transfer or other disposition of Property to a Trust, do not include a testamentary disposition; and
2. (b) ‘power’ includes a discretion as to the way in which an obligation is performed.

(2) In sections 21 (Power to set aside a transfer or disposition of Property to a Trust due to mistake) and 23 (Power to set aside the exercise of powers in relation to a Trust or Trust Property due to mistake), ‘mistake’ includes (but is not limited to):

1. (a) a mistake as to:
2. (i) the effect of,

(ii) any consequences of, or

(iii) any of the advantages to be gained by, a transfer or other disposition of Property to a Trust, or the exercise of a power over or in relation to a Trust or Trust Property;

1. (b) a mistake as to a fact existing either before or at the time of, a transfer or other disposition of Property to a Trust, or the exercise of a power over or in relation to a Trust or Trust Property; or
2. (c) a mistake of law including a law of a foreign jurisdiction.

20. Application of powers under sections 21 to 25

Sections 21 (Power to set aside a transfer or disposition of Property to a Trust due to mistake) to 25 (Applications and orders under sections 21 to 24) apply in relation to the transfer or other disposition of Property to a Trust, or the exercise of any power over or in relation to a Trust or Trust Property that occurs either before or after the coming into force of these Regulations.

21. Power to set aside a transfer or disposition of Property to a Trust due to mistake

(1) In this section, ‘person exercising a power’ means a person who exercises a power to transfer or make other disposition of Property to a Trust on behalf of a Settlor.

(2) The Court may on the application of any person specified in subsection 25(1) (Applications and orders under sections 21 to 24), and in the circumstances set out in subsection 21(3), declare that a transfer or other disposition of Property to a Trust:

• (a) by a Settlor acting in person (whether alone or with any other Settlor); or
• (b) through a person exercising a power, is voidable and:

(i) has such effect as the Court may determine; or

(ii) is of no effect from the time of its exercise.

(3) The circumstances are where the Settlor or person exercising a power:

• (a) made a mistake in relation to the transfer or other disposition of Property to a Trust;
• (b) would not have made that transfer or other disposition but for that mistake; and
• (c) the mistake is of so serious a character as to render it just for the Court to make a declaration under this section.

22. Power to set aside a transfer or disposition of Property to a Trust exercised by fiduciary power

(1) In this section, ‘person exercising a power’ means a person who exercises a power to transfer or make other disposition of Property to a Trust on behalf of a Settlor and who owes a fiduciary duty to the Settlor in relation to the exercise of his or her power.

(2) The Court may on the application of any person specified in subsection 25(1) (Applications and orders under sections 21 to 24), and in the circumstances set out in subsection 22(3) (Power to set aside a transfer or disposition of Property to a Trust exercised by fiduciary power), declare that a transfer or other disposition of Property to a Trust by a Settlor (whether alone or with any other Settlor) through a person exercising a power, is voidable and:

• (a) has such effect as the Court may determine; or
• (b) is of no effect from the time of its exercise.

(3) The circumstances are where, in relation to the exercise of his or her power, the person exercising a power:

• (a) failed to take into account any relevant considerations or took into account irrelevant considerations; and
• (b) would not have exercised the power, or would not have exercised the power in the way it was so exercised, but for that failure to take into account relevant considerations or that taking into account of irrelevant considerations.

(4) This section applies whether or not the circumstances set out in subsection 22(3) occurred as a result of any lack of care or other fault on the part of the person exercising a power, or on the part of any person giving advice in relation to the exercise of the power.

23. Power to set aside the exercise of powers in relation to a Trust or Trust Property due to mistake

(1) In this section, ‘person exercising a power’ means a person who, otherwise than in the capacity of Trustee, exercises a power over, or in relation to a Trust, or Trust Property.

(2) The Court may on the application of any person specified in subsection 25(2) (Applications and orders under sections 21 to 24), and in the circumstances set out in subsection 23(3), declare that the exercise of a power by a Trustee or a person exercising a power over, or in relation to a Trust, or Trust Property, is voidable and:

• (a) has such effect as the Court may determine; or
• (b) is of no effect from the time of its exercise.

(3) The circumstances are where the Trustee or person exercising a power:

• (a) made a mistake in relation to the exercise of his or her power;
• (b) would not have exercised the power, or would not have exercised the power in the way it was so exercised, but for that mistake; and
• (c) the mistake is of so serious a character as to render it just for the Court to make a declaration under this section.

24. Power to set aside the exercise of fiduciary powers in relation to a Trust or Trust Property

(1) In this section, ‘person exercising a power’ means a person who, otherwise than in the capacity of Trustee, exercises a power over, or in relation to a Trust, or Trust Property and who owes a fiduciary duty to a Beneficiary in relation to the exercise of that power.

(2) The Court may on the application of any person specified in subsection 25(2) (Applications and orders under sections 21 to 24), and in the circumstances set out in subsection 24(3), declare that the exercise of a power by a Trustee or a person exercising a power over, or in relation to a Trust, or Trust Property, is voidable and:

• (a) has such effect as the Court may determine; or
• (b) is of no effect from the time of its exercise.

(3) The circumstances are where, in relation to the exercise of his or her power, the Trustee or person exercising a power:

• (a) failed to take into account any relevant considerations or took into account irrelevant considerations; and
• (b) would not have exercised the power, or would not have exercised the power in the way it was so exercised, but for that failure to take into account relevant considerations, or that taking into account of irrelevant considerations.

(4) This section applies whether or not the circumstances set out in section 24(3) occurred as a result of any lack of care or other fault on the part of the Trustee or person exercising a power, or on the part of any person giving advice in relation to the exercise of the power.

25. Applications and orders under sections 21 to 24

(1) An application under subsection 21(2) (Power to set aside a transfer or disposition of Property to a Trust due to mistake) or 22(2) (Power to set aside a transfer or disposition of Property to a Trust exercised by fiduciary power) may be made by any Settlor or any of his or her personal representatives or successors in title.

(2) An application under subsection 23(2) (Power to set aside the exercise of powers in relation to a Trust or Trust Property due to mistake) or 24(2) (Power to set aside the exercise of fiduciary powers in relation to a Trust or Trust Property) may be made by:

1. (a) the Trustee who exercised the power concerned, or the person exercising a power (as the case may be);
2. (b) any other Trustee;
3. (c) a Beneficiary or Enforcer;
4. (d) the Settlor, his heirs, or AFSA in relation to a Trust containing Charitable Trusts, powers or provisions; or
5. (e) any other person with leave of the Court.

(3) Without prejudice to section 17 (Application to and certain powers of the Court) and subject to subsection 25(4), the Court may, consequential upon a declaration made under any of sections 21 (Power to set aside a transfer or disposition of Property to a Trust due to mistake) to 24 (Power to set aside the exercise of fiduciary powers in relation to a Trust or Trust Property), make such order as it thinks fit.

(4) No order may be made under subsection 25(3) which would prejudice any purchaser in good faith for value of any Trust Property without notice of the matters which render the transfer or other disposition of Property to a Trust, or the exercise of any power over or in relation to a Trust or Trust Property, voidable.

26. Savings in respect of applications made under sections 21 to 24

Nothing in sections 21 (Power to set aside a transfer or disposition of Property to a Trust due to mistake) to 24 (Power to set aside the exercise of fiduciary powers in relation to a Trust or Trust Property) shall prejudice:

1. (a) any application for a declaration that a transfer or other disposition of Property to a Trust, or the exercise of any power over or in relation to a Trust or Trust Property, is void or voidable on grounds other than those specified in sections 21 (Power to set aside a transfer or disposition of Property to a Trust due to mistake) to 24 (Power to set aside the exercise of fiduciary powers in relation to a Trust or Trust Property); or
2. (b) any personal remedy which may be available against a Trustee or any other person.

27. Sections 28, 29 and Schedule 1: Interpretation

For the purposes of sections 28 (Arbitration of Trust disputes) and 29 (Powers of the arbitral tribunal) and Schedule 1:

"administration question" means any relief or question in respect of which an action, application or other reference to the court could be brought or made under these Regulations;

"Beneficiary" includes an object of a power, whether or not ascertained or in existence and a charity;

"dispute" includes a difference;

"power holder" means any person holding a power in relation to a Trust (including any power of appointment, consent, direction, revocation or variation, and any power to appoint or remove Trustee or power holders) and includes a person in the position of a Protector;

"the parties in relation to the Trust" means any Trustee, Beneficiary or power holder of or under the Trust, in their capacity as such.

28. Arbitration of Trust disputes

(1) Where a Trust Instrument provides that any dispute or administration question arising between any of the parties in relation to the Trust shall be submitted to arbitration ("a Trust arbitration"), that provision shall, for all purposes under the Arbitration Regulations have effect as between those parties as if it were an arbitration agreement and as if those parties were parties to that agreement.

(2) Where a Trust Instrument does not provide that any dispute or administration question arising between any of the parties in relation to the Trust shall be submitted to arbitration but the parties to that dispute agree in writing to have it resolved by a Trust arbitration, that agreement shall, for all purposes under the Arbitration Regulations, have effect as between those parties as if it were an arbitration agreement.

(3) The Arbitration Regulations shall apply to a Trust arbitration in accordance with the provisions of Schedule 1.

(4) The Court may make such orders in relation to an arbitration or possible arbitration which supplement or vary the application of Schedule 1 as may in the opinion of the Court be appropriate in the circumstances of the case.

29. Powers of the arbitral tribunal

(1) This section shall apply except to the extent otherwise provided in the Trust Instrument.

(2) The arbitral tribunal (hereinafter referred to as "the tribunal") may, in addition to all other powers of the tribunal, at any stage in a Trust arbitration, exercise all the powers of the Court (whether arising by law (including these Regulations), under the inherent jurisdiction of the Court or otherwise) in relation to the administration, execution or variation of a Trust or the exercise of any power arising under a Trust.