''Nestle v National Westminster Bank plc'' EWCA_Civ_12
is_an_English_trusts_law.html" ;"title="992
EWCA Civ 12
is an English trusts law">992
EWCA Civ 12
is an English trusts law case concerning the duty of care when a trustee is making an investment.

Facts

A testator died in 1922 and named his widow, two sons and wives and one grandchild as the beneficiaries. The wife got the family home as a life interest and a tax free Life annuity, annuity. The two sons got annuities between age 21 and 25 and life interests in half the trust with a power to appoint income to their wives and Georgina, the grandchild, got the remainder. In 1922 there was £53,963 and in 1986 when Georgina became entitled, there was £269,203. She claimed that had the fund been invested properly it would have been worth well over £1m. The trust company had failed to conduct periodic reviews of investments. They invested in tax-exempt

gilts Gilt-edged securities are bonds issued by the UK Government. The term is of British origin, and then referred to the debt securities issued by the Bank of England on behalf of His Majesty's Treasury, whose paper certificates had a gilt (or gilde ...

because the sons were domiciled abroad, meaning exemption from inheritance tax.

Judgment

High Court

Hoffmann J (as he then was) held that there was no breach of the duty of care. He said the following.

000 Triple zero, Triple Zero, Zero Zero Zero, Triple 0, Triple-0, 000, or 0-0-0 may refer to: * 000 (emergency telephone number), the Australian emergency telephone number * "Triple Zero", a song by AFI from ''Shut Your Mouth and Open Your Eyes'' * Th ...

WTLR 795

Court of Appeal

Staughton LJ held there was no breach of trust. Despite this the trust company fell ‘woefully short of maintaining the real value of the fund, let alone matching the average increase in price of ordinary shares’. The company had not acted ‘conscientiously, fairly and carefully’ and there was ‘not much for the bank to be proud of in its administration of the… trust’. He emphasised that ‘trustees’ performance must not be judged with hindsight: 'after the event even a fool is wise, as a poet said nearly 3,000 years ago…' and accepted evidence that equities were regarded as risky before 1959. ‘It was only in 1959 that hey became more popular’

Dillon LJ Sir George Brian Hugh Dillon (2 October 1925 – 22 June 2003) was a British lawyer and judge who served as a Lord Justice of Appeal from 1982 to 1994. Biography Dillon was born in a naval family, the son of Captain George Crozier Dillon, RN, ...

and

Leggatt LJ Sir Andrew Peter Leggatt, PC (8 November 1930 – 21 February 2020) was a British judge who served as the Lord Justice of Appeal and as a member of the Privy Council. He was noted for his acerbic wit and precise, well-written judgements. As ...

concurred.

Notes

{{reflist, 2

References

*C Webb and T Akkouh, ''Trusts law'' (Palgrave 2008) 315 suggest ''

Wednesbury Wednesbury () is a market town in Sandwell in the county of West Midlands, England. It is located near the source of the River Tame. Historically part of Staffordshire in the Hundred of Offlow, at the 2011 Census the town had a population of 3 ...