“Exemption clauses are a common feature of modern trusts. These seek to exempt trustees from liability for breach of trust, or to indemnify them from the trust assets for personal liability for breach. Contract law has long featured a rule that exemption clauses cannot protect a person from liability arising from the person’s own fraud. It cannot safely be assumed that rules of contract will be applied to trusts and, if they are, how they might be adapted to the different trust context. The rule in contract is that a person’s own fraud cannot be excluded …”
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Toby Graham and David Russell AM QC, Exemption clauses in the modern age: do they result in an ‘institution in crisis’?, Trusts and Trustees, volume 28, issue 2, March 2022, pages 54-63, https://doi.org/10.1093/tandt/ttac011. Published 28 February.
First posted 2022-03-04 12:00:57
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