Margaret Rosalind Stokell & Ors, Re

The court has an inherent supervisory jurisdiction to give directions enabling trustees to administer trust property safely where uncertainty, risk or exceptional difficulty would otherwise expose them to personal liability.

Extended Re Benjamin relief may be granted for speculative, remote or unresolved claims which cannot responsibly be ignored. The court may approve a fair and proportionate claims procedure, including notice, initial classification by trustees, judicial review of rejected claims and retention of funds for residual liabilities. The court does not substitute its own view for that of trustees acting in good faith, for proper purposes and within the range of decisions open to reasonable trustees properly directing themselves.

The trustees of the Jesus Fellowship Community Trust sought directions under CPR Part 64 concerning the final winding-up and distribution of the Trust following the collapse of the Jesus Fellowship Community.

The Trust’s assets had largely derived from contributions made by members of a communal organisation. The trustees had operated a redress scheme and resolved other claims, but remained aware of possible equitable and proprietary claims outside that scheme. They sought authorisation for a court-supervised procedure to identify and manage further claims before final distribution.

The issues were whether the trustees had power to adopt the procedure, whether they were acting properly and within their fiduciary duties, whether extended Re Benjamin relief should be granted, and whether the proposed notice, determination, retention and finality arrangements were fair, proportionate and lawful.

1. Application granted. The trustees were authorised and directed to implement the proposed claims and resolution procedure, with the protection of the court.
2. The court possesses an inherent supervisory jurisdiction over trusts, particularly where trustees face uncertainty, risk or exceptional difficulty. That jurisdiction permits directions enabling trustees to distribute trust property on a particular basis where it is just and expedient to do so. Re Benjamin relief is not confined to uncertainty about the identity or whereabouts of beneficiaries. It may extend to unresolved, speculative or remote claims which cannot responsibly be disregarded.
3. Trustees must act in good faith, for proper purposes and within the range of decisions open to reasonable trustees properly directing themselves. Where they do so, the court does not substitute its own judgment for theirs. The proposed procedure fell within that range.
4. The Trust Deed conferred sufficiently broad powers to permit the proposed structured and court-supervised process. The trustees’ staged approach, including prior beneficiary payments and the redress scheme, did not prevent further supervised arrangements for unresolved claims.
5. Following Re MF Global UK Ltd (No. 3), the court approved a procedure which did not finally adjudicate claims at the outset but required notice, specified information, an initial classification of claims, a right of referral to the court and retention of funds for residual liabilities. The procedure converted an amorphous risk of claims into a defined and manageable process while preserving substantive rights.
6. The notice arrangements, rejection criteria, judicial oversight, retention provisions and proposed final distributions were fair, proportionate and lawful. Extended Re Benjamin relief was therefore justified.