On 23/05/2013,
you requested for the version in force on 23/05/2013
incorporating all amendments published on or before 23/05/2013.
The closest version currently available is that of 01/03/2010.
PART II
INVESTMENTS
4.
—(1) Subject to the provisions of this Part, a trustee may make any kind of investment that he could make if he were absolutely entitled to the assets of the trust.
[45/2004]
(2) For the purpose of subsection (1), “investment” includes investment in assets that do not yield any income.
[45/2004]
(3) This section shall apply in relation to trusts whether created before, on or after 15th December 2004.
[UK Trustee 2000, s. 3 (1)]
[45/2004]
5.
—(1) In exercising any power of investment, whether arising under this Part or otherwise, a trustee shall have regard to the standard investment criteria.
[45/2004]
(2) A trustee shall, from time to time, review the investments of the trust and consider whether, having regard to the standard investment criteria, they should be varied.
[45/2004]
(3) The standard investment criteria, in relation to a trust, are —
(a)
the suitability to the trust of investments of the same kind as any particular investment proposed to be made or retained and of that particular investment as an investment of that kind; and
(b)
the need for diversification of investments of the trust, in so far as is appropriate to the circumstances of the trust.
[45/2004]
(4) This section shall apply in relation to trusts whether created before, on or after 15th December 2004.
[UK Trustee 2000, s. 4]
[45/2004]
6.
—(1) Except as otherwise provided by subsection (3), a trustee shall, before exercising any power of investment, whether arising under this Part or otherwise, obtain and consider proper advice about the way in which the power should be exercised, having regard to the standard investment criteria.
[45/2004]
(2) Except as otherwise provided by subsection (3), a trustee shall, when reviewing the investments of the trust, obtain and consider proper advice about whether the investments should be varied, having regard to the standard investment criteria.
[45/2004]
(3) A trustee need not obtain the advice required under subsection (1) or (2) if he reasonably concludes that in all the circumstances it is unnecessary or inappropriate to do so.
[45/2004]
(4) In this section, “proper advice” means the advice of a person who is reasonably believed by the trustee to be qualified to give such advice by his ability in and practical experience of financial and other matters relating to the proposed investment.
[45/2004]
(5) This section shall apply in relation to trusts whether created before, on or after 15th December 2004.
[UK Trustee 2000, s. 5]
[45/2004]
7. A trustee shall not be liable for breach of trust by reason only of his continuing to hold an investment which has ceased to be an investment authorised by the trust instrument or by this Act.
[UK Trustee 1925, s. 4; Trustees Ordinance 1955 Ed., s. 7]
[23/92]
Investment in bearer securities
8. [Repealed by Act 45/2004]
9.
—(1) A trustee lending money on the security of any property on which he can properly lend shall not be chargeable with breach of trust by reason only of the proportion borne by the amount of the loan to the value of the property at the time when the loan was made, if it appears to the court —
(a)
that in making the loan the trustee was acting upon proper advice obtained in accordance with section 6; and
(b)
that the amount of the loan does not exceed two-third parts of the value of the property as stated in the report made by the person giving proper advice in accordance with section 6.
[23/92; 45/2004]
(2) This section shall apply to transfers of existing securities as well as to new securities and to investments made before, on or after 26th June 1992*.
* Date of commencement of the Trustees (Amendment) Act 1992 (Act 23 of 1992).
[UK Trustee 1925, s. 8; Trustees Ordinance 1955 Ed., s. 9]
[23/92]
10.
—(1) Where a trustee improperly advances trust money on a mortgage security which would at the time of the investment be a proper investment in all respects for a smaller sum than is actually advanced thereon, the security shall be deemed to be an authorised investment for the smaller sum, and the trustee shall only be liable to make good the sum advanced in excess thereof with interest.
[23/92]
(2) This section shall apply to investments made before, on or after 26th June 1992.
[UK Trustee 1925, s. 9; Trustees Ordinance 1955 Ed., s. 10]
[23/92]
11.
—(1) Trustees lending money on the security of any property on which they can lawfully lend may contract that such money shall not be called in during any period not exceeding 5 years from the time when the loan was made, provided that —
(a)
interest be paid within a specified time not exceeding 10 days after every monthly or other day on which it becomes due; and
(b)
there be no breach of any covenant by the mortgagor contained in the instrument of mortgage or charge for the maintenance and protection of the property.
[23/92]
(2) On a sale by trustees of land for an estate in fee simple, or held under a grant issued under the State Lands Act (Cap. 314), or for a term having at least 30 years to run, the trustees may, where the proceeds are liable to be invested, contract that the payment of any part, not exceeding two-thirds, of the purchase money shall be secured by mortgage of the land sold, with or without the security of any other property, but such mortgage, if any buildings are comprised therein, shall contain a covenant by the mortgagor to keep such buildings insured against loss or damage by fire to the full value thereof.
[23/92]
(3) Where any securities of a company are subject to a trust, the trustees may concur in any scheme or arrangement —
(a)
for the reconstruction of the company;
(b)
for the sale of any or any part of the property and undertaking of the company to another company;
(c)
for the acquisition of the securities of the company, or of control thereof, by another company;
(d)
for the amalgamation of the company with another company;
(e)
for the release, modification, or variation of any rights, privileges or liabilities attached to the securities or any of them,
in the like manner as if they were entitled to such securities beneficially, with power to accept any securities of any denomination or description of the reconstructed or purchasing or new company in lieu of or in exchange for all or any of the first-mentioned securities.
(4) The trustees shall not be responsible for any loss occasioned by any act or thing so done if they have discharged the statutory duty of care, and may retain any securities so accepted as specified in subsection (3) for any period for which they could have properly retained the original securities.
[23/92; 45/2004]
(5) If any conditional or preferential right to subscribe for any securities in any company is offered to trustees in respect of any holding in the company, they may, as to all or any of the securities, either exercise such right and apply capital money subject to the trust in payment of the consideration, or renounce such right, or assign for the best consideration that can be reasonably obtained the benefit of such right or the title thereto to any person, including any beneficiary under the trust, without being responsible for any loss occasioned by any act or thing so done by them if they have discharged the statutory duty of care.
[23/92; 45/2004]
(6) The consideration for any assignment referred to in subsection (5) shall be held as capital money of the trust.
[23/92]
(7) The powers conferred by this section shall be exercisable subject to the consent of any person whose consent to a change of investment is required by law or by the instrument, if any, creating the trust.
[23/92]
(8) Where the loan referred to in subsection (1), or the sale referred to in subsection (2), is made under the order of the court, the powers conferred by those subsections, respectively, shall apply only if and as far as the court may by order direct.
[UK Trustee 1925, s. 10; Trustees Ordinance 1955 Ed., s. 11]
[23/92]
12.
—(1) Trustees may, pending the negotiation and preparation of any mortgage or charge, or during any other time while an investment is being sought for, pay any trust money into a bank to deposit or other account, and all interest, if any, payable in respect thereof shall be applied as income.
[23/92]
(2) Trustees may apply capital money subject to a trust in payment of the calls on any shares subject to the same trust.
[23/92]
(3) Trustees may —
(a)
where they are of the opinion that it is desirable to purchase a dwelling-house for the use of any beneficiary under the trust, purchase a dwelling-house with any trust funds, whether at the time in a state of investment or not; or
(b)
retain any dwelling-house that forms part of the trust notwithstanding any trust for conversion contained in the instrument creating the trust,
and permit the beneficiary to reside in the dwelling-house upon such terms and conditions consistent with the trust and the extent of the interest of the beneficiary as the trustee thinks fit.
[23/92]
(4) In subsection (3), “dwelling-house” means a place of residence and includes a building or tenement wholly or principally used, constructed or adapted for human habitation.
[UK Trustee 1925, s. 11; Trustees Ordinance 1955 Ed., s. 12]
[45/2004]