CHAPTER
179
TRUSTS (CHOICE OF GOVERNING LAW) |
ARRANGEMENT OF
SECTIONS |
SECTION |
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Declaration governing law. |
Provision for change of governing law. |
Determination of governing law. |
Matters determined by governing law. |
Imitations in foreign law. |
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CHAPTER 179 |
TRUSTS (CHOICE OF
GOVERNING LAW) |
An Act to
provide for a choice of governing law in the creation of trust and for matters
connected therewith. | 33 of 1989
20 of 1996 |
[Assent 29th
December, 1989]
[Commencement 15th January, 1990] |
1. This Act may be cited as the Trusts (Choice of
Governing Law) Act, 1989. | Short title. |
2. In this Act- | Interpretation. |
"dispose"
and "disposition", in relation to property, means every form of
conveyance, transfer, assignment, lease, mortgage, pledge or other transaction
by which any legal or equitable interest in property is created, transferred or
extinguished; |
"formalities"
in relation to a disposition of property means any documentary or other actions
required generally by the laws of a relevant jurisdiction for all dispositions
of like form concerning property of like nature, without regard to- |
(a) the fact
that the particular disposition is made in trust; |
(b) the terms
of the trust; |
(c) the
circumstances of the parties to the disposition; or |
(d) any other
particular circumstances; but includes any special formalities required by
reason that the party effecting the disposition is not of full age, is subject
to a mental or bodily infirmity or is a corporation; |
"governing
law" means the law governing a trust executed in The Bahamas or elsewhere; |
"heirship
right" means any right, claim or interest in, against or to property of a
person arising, accruing or existing in consequence of, or in anticipation of,
that person's death, other than any such right, claim or interest created by
will or other voluntary disposition by such person or resulting from an express
limitation in the disposition of the property of such person; |
"personal
relationship" includes every form of relationship by blood or marriage,
including former marriage and in particular a personal relationship between two
persons which exists if- |
(a) one is the
child of the other, natural or adopted, whether or not the adoption is
recognised by law, legitimate or illegitimate; |
(b) one is
married to the other, whether or not the marriage is recognised by law; |
(c) one cohabits
with the other or so conducts himself or herself in relation to the other as to
give rise in any jurisdiction to any rights, obligations or responsibilities
analogous to those of parents and child or husband and wife; or |
(d) personal
relationships exist between each of them and a third person, |
but no
change in circumstances cause personal relationship once established to
terminate; |
"property"
means movable and immovable property; |
"settlor"
in relation to a trust, means each person who directly or indirectly, on behalf
of himself or on behalf of any other, as owner or as the holder of a power in
that behalf, disposes of property to be held in such trust or declares or otherwise
creates such trust. |
3. (1) This Act applies to every trust and disposition
of property in trust. | Application. |
(2) This Act shall
not render any person liable for anything done prior to its commencement. |
4. (1) For the avoidance of doubt it is hereby stated
that in the creation of trust, a settlor, whether or not he is resident in The
Bahamas, may expressly declare in the trust instrument that the laws of The
Bahamas shall be the governing law of the trust. | Declaration governing law. |
(2) A term of a
trust expressly declaring that the laws of The Bahamas shall govern the trust
is valid, effective and conclusive regardless of any other circumstance. |
(3) A term of a
trust that the laws of The Bahamas shall govern a particular aspect of a trust
or that The Bahamas shall be the forum for the administration of the trust or
any other like provision is conclusive evidence, subject to any contrary term
of the trust, that the settlor intended the laws of The Bahamas to be the
governing law of the trust and is valid and effective accordingly. |
5. (1) Where a term of a trust so provides, the
governing law may be changed to or from the laws of The Bahamas if- | Provision for change of governing law. |
(a) in the case
of a change to the laws of The Bahamas, such change is recognised by the
governing law previously in effect; and |
(b) in the case
of a change from the laws of The Bahamas, the new governing law would recognise
the validity of the trust and the respective interests of the beneficiaries. |
(2) A change in
the governing law shall not affect the legality or validity of, or render any
person liable for anything done before the change. |
6. In determining the governing law of a trust
consideration shall first be given to the terms of the trust in issue and to
any evidence therein as to the intention of the parties; and the other
circumstances of the trust shall be considered only if the terms of the trust
fail to provide such evidence as to the intention of the parties. | Determination of governing law. |
7. (1) Subject to subsection (2), all questions arising
in regard to a trust which is for the time being governed by the laws of The
Bahamas or in regard to any disposition of property upon the trust thereof
including, without prejudice to the generality of the foregoing, questions as
to- | Matters determined by governing law. |
(a) the
capacity of the settlor; |
(b) any aspect
of the validity of the trust or disposition or the interpretation or effect
thereof; |
(c) the
administration of the trust, whether the administration be conducted in The
Bahamas or elsewhere, including questions as to powers, obligations,
liabilities and rights of trustees and their appointment and removal; or |
(d) the
existence and extent of powers, conferred or retained; including powers of
variation or revocation of the trust and powers of appointment, and validity of
any exercise thereof, |
shall be
determined in accordance with the laws of The Bahamas, without reference to the
laws of any other jurisdictions with which the trust or disposition may be
connected. |
(2) This section- |
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(i) any
disposition of property which is neither owned by the settlor nor the subject
of a power in that behalf vested in the settlor; |
(ii) any
trust or disposition of immovable property situate in a jurisdiction other than
The Bahamas in which such trust or disposition is invalid according to the laws
of such jurisdiction; |
(iii) any
testamentary trust or disposition which is invalid according to the laws of the
testator's domicile; |
(b) shall not
affect the recognition of foreign laws in determining whether the settlor is
the owner of the settled property or is the holder of a power to dispose of
such property; |
(c) shall take
effect subject to any express term of a trust or disposition to the contrary; |
(d) as regards
the capacity of a corporation, shall not affect the recognition of the laws of
its place of incorporation; and |
(e) shall not
affect the recognition of foreign laws prescribing generally, without reference
to the existence or terms of the trust, the formalities for the disposition of
property. |
8. Without limiting the generality of section 7, it is
hereby expressly declared that no trust governed by the laws of The Bahamas and
no disposition of property to be held on trust that is valid under the laws of
The Bahamas is void, voidable, liable to be set aside or defective in any
manner by reference to a foreign law; nor is the capacity of any settlor to be
questioned nor is the trustee or any beneficiary or any
other person to be subjected to any liability or deprived of any right by
reason that- | Imitations in foreign law. |
(a) the laws of
any foreign jurisdiction prohibit or do not recognise the concept of a trust;
or |
(b) the trust
or disposition avoids or defeats rights, claims or interest conferred by
foreign law upon any person by reason of a personal relationship to the settlor
or by way of heirship rights or contravenes any rule of foreign law or any
foreign, judicial or administrative order or action intended to recognise,
protect, enforce or give affect to any such rights, claims or interest. |
9. An heirship right conferred by foreign law in
relation to the property of a living person shall not be recognised as- | Heirship rights.[i] |
(a) affecting
the ownership of immovable property in The Bahamas or movable property wherever
situate for the purposes of paragraphs (a) and (b) of subsection (2) of section
7 or for any other purpose; or |
(b) constituting
an obligation or liability for the purposes of the Fraudulent Dispositions Act, 1991 or for
any other purpose. |
10. A foreign judgment shall not be recognised or
enforced or give rise to any estoppel insofar as it is inconsistent with
section 8 or section 9. | Foreign judgments.[ii] |