Richard Laignel
Partner | Legal
Jersey
Richard Laignel
Partner
Jersey
X marks the spot: the evolving role of trust protectors
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A protector plays an important role in a trust structure, overseeing how a trustee exercises its powers. Case law in Jersey and Bermuda has debated how that role should operate in practice (absent any express provisions to the contrary in the trust instrument) and whether a protector’s consent function should be viewed narrowly or more widely where the choice has not been made in the trust terms. Now a judgment from the Judicial Committee of the Privy Council on the topic has provided some much-needed clarity.
In this briefing, we outline how the courts have approached the role of trust protectors and what this means when appointing and drafting for the position.
What is a protector?
A protector is appointed to oversee how a trustee exercises their powers in relation to a trust. The protector is not a trustee but is responsible for ensuring that the trustee fulfils their duties and exercises their powers properly.
Why appoint a protector?
A protector offers additional oversight when and after a settlor transfers assets into a trust. The trust instrument will indicate whether the protector's powers are personal, exercised at their own discretion and benefit, or fiduciary, requiring that they act in the best interests of the beneficiaries. Most protectors act in a fiduciary capacity, except where the settlor, as protector, has reserved personal powers.
Even with a professional trustee, a protector can give further assurance that trustees will perform their fiduciary duties appropriately.
Choosing a protector
The role may require technical knowledge of trusts, particularly in light of the findings of the Judicial Committee of the Privy Council's decision in A & Others v C & Others [2026] UKPC 11, discussed below (the PC Judgment). Appointing someone without proper understanding of the responsibilities increases the risk of their decisions being challenged. The settlor and trustee should consider whether a trust professional, rather than a friend or family member, would be more suitable. While this may involve higher costs, it may reduce the risk of future claims.
Potential conflicts of interest should also be considered, for example, if the protector is also a beneficiary or holds another role, such as investment adviser to the trust. It is important to assess whether this is compatible with the protector's duties, and whether they can act in the beneficiaries' best interests despite any personal interests.
When there is tension within a family, appointing a family member as protector can increase conflict and complicate matters. Family dynamics and pre-existing disputes can affect the decisions of a beneficiary who is also protector. These risks may be reduced by appointing an independent protector who is neither a family member nor a beneficiary and who can act impartially or a committee of protectors comprising a mixture of family or friends and professional protectors.
The narrow role vs the wider role
The PC Judgment has provided helpful clarity on the role of protectors by endorsing the so-called wider role of protectors' consent powers.
Under the wider role, the protector is entitled to form his or her own view of the merits of the trustees’ proposal and may legitimately veto the proposal even if it is one within the range of decisions which the trustee could lawfully make. This is in contrast to the narrow role, which takes the position that the protector’s task is strictly limited to reviewing the legality and rationality of the trustee's actions.
The Privy Council stressed that the scope of a protector's role always depends on the specific trust instrument. In light of this, there are several practical considerations for settlors, trustees and protectors to consider.
Case background
The proceedings involved in the Privy Judgment concerned a group of discretionary trusts governed by English, Bermudian and Jersey law (the X Trusts). All but one of the X Trusts gave the protectors two main powers:
- to approve or refuse appointments of capital to beneficiaries
- to approve or disapprove the trustees’ exercise of voting rights in respect of certain "specified securities"
In 2017, the trustees proposed to use their discretion to divide trust assets unequally among beneficiaries, but needed the protectors’ written consent. After review, the protectors decided they were unlikely to approve the proposals, on the understanding that they had the wider role in giving the requisite consent.
Both the Supreme Court of Bermuda (as the Court of first instance) and the Court of Appeal found the protectors' powers to be more limited (i.e. the narrow role), but the Privy Council allowed the appeal and confirmed that the protectors had the wider role in relation to their consent powers.
For further detailed analysis of the judgment, please refer to the companion briefing from our Trusts Advisory Group: Clarifying the protector's role: key takeaways from the Privy Council's 2026 judgment
Practical considerations
Clear drafting remains essential
It is important to recognise that the judgment does not mandate a single, wide-role approach to protector consent powers. The settlor, trustees and protectors can define in any new trust instrument, or an amendment to an existing trust instrument, whether a protector's consent powers are wide, narrow or expressly limited.
Careful consideration on those to be appointed
It is important that those to be appointed as protector have the time and capacity to deal with the demands of the role and are not likely to be in a position of conflict in the exercise of their powers. Considerations around who they are, how many there are, where they are located and who would succeed any proposed protectors are all important to consider early on.
Greater need for information sharing and procedural clarity
Where protectors have the wider role, they must be able to engage thoroughly with trustee proposals, which means there is likely to be a greater need for clear information-sharing processes between trustees and protectors. New trust instruments should expressly state what information trustees must disclose to protectors before making any decision requiring protector consent. For existing trusts, it is worth considering whether there should be changes to clarify what disclosure is required, so that protectors can make informed decisions.
Protectors' expectations regarding remuneration, indemnity and exculpation
Protectors may seek express provisions in the trust instrument for appropriate fees, robust indemnities and exculpation from liability. Many (especially older) trusts lack these protections, so practitioners might consider whether supplementary provisions, or specific insurance or indemnity arrangements, should be included if permitted and there is no conflict for trustee and protector in effecting such changes. The Trusts (Jersey) Law 1984, as amended, and the Trusts (Guernsey) Law, 2007 are silent on indemnity or exculpation for protectors, so these points should be addressed in the trust instrument or related documentation.
Impact on suitability and cost
With an expanded scope, the role of protector is possibly more demanding, which may reduce the pool of potential candidates and/or persons willing to take office. Where there are professional protectors, their fees and insurance premiums may potentially also increase, which may place a greater burden on the trust fund. In some cases, this could potentially be managed by narrowing the role and limiting consent requirements to particularly significant decisions.
Reassessing the scope of consent powers
The Privy Council decision presents an opportunity to review whether a trust truly requires wide-ranging consent powers for protectors. This would need to be analysed on a case-by case-basis, but in some instances, it may be deemed sufficient to provide the protector with key control powers (for example, a power to appoint and remove trustees), in lieu of broader powers to veto trustee decisions. Settlors, trustees and protectors should agree, either at the establishment of the trust or by amended or supplemental trust instruments, on the most appropriate balance of control and oversight.
Following the PC Judgment, the role of the protector is determined, inter alia, by the language of the trust instrument. Consequentially, settlors and trustees should ensure their intentions, and the corresponding practical and legal framework, are clearly expressed in the trust documents. For existing trusts, it may be sensible to carry out a review and make any needed amendments to address the practical realities and increased risks highlighted by the decision where this is possible.
How Ogier can help
Ogier advises settlors, trustees and family offices on the establishment, restructuring and administration of trust structures across leading offshore jurisdictions.
We regularly advise on the appointment and role of protectors, including drafting consent provisions that reflect the preferred approach in light of recent case law.
Our team also acts in court applications concerning trustee powers and protector consent functions, ensuring that trust structures remain robust, clear and aligned with clients’ long-term objectives.
For more information, contact a member of our team.
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Disclaimer
This client briefing has been prepared for clients and professional associates of Ogier. The information and expressions of opinion which it contains are not intended to be a comprehensive study or to provide legal advice and should not be treated as a substitute for specific advice concerning individual situations.
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