INDEMNITIES AND RELEASES FOR TRUSTEES - Rights of Indemnity Against Beneficiaries - Part III
·the general principle is that a trustee is entitled to an indemnity for liabilities properly incurred in carrying out the trust, and that right extends beyond the trust property and is enforceable in equity against a beneficiary who is sui juris; ·the basis of the principle is that the beneficiary who gets the benefit of the trust should bear its burdens, unless he can show some good reason why the trustee should bear the burdens alone; ·the right of indemnification is not confined to the case where there is only one beneficiary.
It applies to cases of multiple beneficiaries as long as they are all sui juris and entitled to the same interest as absolute owners of the trust property between them; ·the liability to indemnify could apply to trustees of subtrusts that were beneficiaries of the principle trust; and ·prima facie, the beneficiaries share the liability in proportion to the extent of their respective beneficial interests in the trust.
With the incidence of personal liability for trustees, it is nice to see that the caselaw strongly supports, in the right circumstances, the ability of the trustee to come back against and collect, if necessary, from the beneficiary.
All the best, Suzana and Ian. --------
