Maintenance, Advancement and Protective Trusts
—(1) Where any property is held by trustees in trust for any person for any interest, whether vested or contingent, then, subject to any prior interests or charges affecting that property —
during the infancy of any such person, if his interest so long continues, the trustees may, at their sole discretion, pay to his parent or guardian, if any, or otherwise apply for or towards his maintenance, education or benefit, the whole or such part, if any, of the income of that property as may, in all the circumstances, be reasonable, whether or not there is —
any other fund applicable to the same purpose; or
any person bound by law to provide for his maintenance or education; and
if such person on attaining the age of 21 years has not a vested interest in such income, the trustees shall thenceforth pay the income of that property and of any accretion thereto under subsection (2) to him, until he either attains a vested interest therein or dies, or until failure of his interest.
(1A) In deciding whether the whole or any part of the income of the property is during a minority to be paid or applied for the purposes mentioned in subsection (1), the trustees shall have regard to the age of the infant and his requirements and generally to the circumstances of the case, and in particular to what other income, if any, is applicable for the same purposes; and where trustees have notice that the income of more than one fund is applicable for those purposes, then, so far as practicable, unless the entire income of the funds is paid or applied as mentioned in subsection (1) or the court otherwise directs, a proportionate part only of the income of each fund shall be so paid or applied.
(2) During the infancy of any such person, if his interest so long continues, the trustees shall accumulate all the residue of that income by investing it, and any profits from so investing it, from time to time in authorised investments, and shall hold those accumulations as follows:
if any such person —
attains the age of 21 years, or marries under that age, and his interest in such income during his infancy or until his marriage is a vested interest; or
on attaining the age of 21 years or on marriage under that age becomes entitled to the property from which such income arose in fee simple, absolute or determinable, or under a grant issued under the State Lands Act (Cap. 314) or absolutely,
the trustees shall hold the accumulations in trust for that person absolutely, and so that the receipt of that person after marriage, and though still an infant, shall be a good discharge; and
in any other case the trustees shall, notwithstanding that such person had a vested interest in such income, hold the accumulations as an accretion to the capital of the property from which the accumulations arose, and as one fund with such capital for all purposes,
but the trustees may, at any time during the infancy of such person if his interest so long continues, apply those accumulations, or any part thereof, as if they were income arising in the then current year.
(3) This section shall apply in the case of a contingent interest only if the limitation or trust carries the intermediate income of the property, but it shall apply to a future or contingent legacy by the parent of, or a person standing in loco parentis to, the legatee, if and for such period as, under the general law, the legacy carries interest for the maintenance of the legatee, and in such latter case the rate of interest shall (if the income available is sufficient and subject to any provision of the Rules of Court to the contrary) be $5 per centum per annum.
(4) This section shall apply to a vested annuity in like manner as if the annuity were the income of property held by trustees in trust to pay the income thereof to the annuitant for the same period for which the annuity is payable, except that in any case accumulations made during the infancy of the annuitant shall be held in trust for the annuitant or his personal representatives absolutely.
(5) This section shall not apply where the instrument, if any, under which the interest arises came into operation before 1st September 1929.
[UK Trustee 1925, s. 31; Trustees Ordinance 1955 Ed., s. 33]
—(1) Trustees may at any time or times pay or apply any capital money subject to a trust, for the advancement or benefit in such manner as they may, in their absolute discretion, think fit, of any person entitled to the capital of the trust property or of any share thereof, whether absolutely or contingently on his attaining any specified age or on the occurrence of any other event, or subject to a gift over on his death under any specified age or on the occurrence of any other event, and whether in possession or in remainder or reversion.
(2) Any payment or application may be made under subsection (1) notwithstanding that the interest of such person is liable to be defeated by the exercise of a power of appointment or revocation, or to be diminished by the increase of the class to which he belongs.
(3) The money paid or applied under subsection (1) for the advancement or benefit of any person shall not exceed altogether in amount one-half of the presumptive or vested share or interest of that person in the trust property; and if that person is or becomes absolutely and indefeasibly entitled to a share in the trust property the money so paid or applied shall be brought into account as part of such share.
(4) No payment or application shall be made under subsection (1) so as to prejudice any person entitled to any prior life or other interest, whether vested or contingent, in the money paid or applied unless such person is in existence and of full age and consents in writing to such payment or application.
(5) This section shall not apply to trusts constituted or created before 1st September 1929.
[UK Trustee 1925, s. 32; Trustees Ordinance 1955 Ed., s. 34]
—(1) Where any income, including an annuity or other periodical income payment, is directed to be held on protective trusts for the benefit of any person (referred to in this section as the principal beneficiary) for the period of his life or for any less period, then, during the period (referred to in this section as the trust period) such income shall, without prejudice to any prior interest, be held on the following trusts:
upon trust for the principal beneficiary during the trust period or until he, whether before or after the termination of any prior interest, does or attempts to do or suffers any act or thing, or until any event happens, other than an advance under any statutory or express power, whereby, if such income were payable during the trust period to the principal beneficiary absolutely during that period, he would be deprived of the right to receive the same or any part thereof, in any of which cases, as well as on the termination of the trust period, whichever first happens, this trust of such income shall fail or determine;
if the trust referred to in paragraph (a) fails or determines during the subsistence of the trust period, then, during the residue of that period, the said income shall be held upon trust for the application thereof for the maintenance or support, or otherwise for the benefit, of all or any one or more exclusively of the other or others of the following persons:
the principal beneficiary and his or her wife or husband, if any, and his or her children or more remote issue, if any; or
if there is no wife or husband or issue of the principal beneficiary in existence, the principal beneficiary and the persons who would, if he were actually dead, be entitled to the trust property or the income thereof or to the annuity fund, if any, or arrears of the annuity, as the case may be,
as the trustees in their absolute discretion, without being liable to account for the exercise of such discretion, think fit.
(2) This section shall not apply to trusts coming into operation before 1st September 1929 and has effect subject to any variation of the implied trusts aforesaid contained in the instrument creating the trust.
(3) Nothing in this section shall operate to validate any trust which would, if contained in the instrument creating the trust, be liable to be set aside.
[UK Trustee 1925, s. 33; Trustees Ordinance 1955 Ed., s. 35]