Overview
The Challenge
The beneficiaries alleged that a former trustee of a family trust structure, holding assets across several offshore jurisdictions, had made a series of investment decisions in breach of his fiduciary duties, resulting in substantial losses to the trust fund. Establishing the facts required tracing a complex pattern of transactions across multiple entities and jurisdictions, several of which had limited public disclosure requirements, making the underlying evidential picture difficult to assemble.
The family relationships involved added a further layer of sensitivity: several beneficiaries wished to pursue recovery of the trust's losses without permanently fracturing family relationships that would need to endure well beyond the resolution of the dispute.
Our Approach
Our Disputes team led an extensive asset-tracing exercise, working with forensic accountants across the relevant jurisdictions to reconstruct the pattern of transactions underlying the alleged breaches. We worked alongside our Private Wealth team throughout, given the trust and succession law considerations that ran alongside the contentious issues, and advised the beneficiaries on a litigation strategy designed to create genuine settlement leverage without foreclosing a negotiated resolution.
We coordinated proceedings and protective measures across the relevant offshore jurisdictions to preserve the beneficiaries' position while settlement discussions proceeded, ensuring the former trustee could not dissipate assets during the process.
The Outcome
The matter was resolved through a negotiated settlement that secured a significant recovery for the beneficiaries without the need for a full trial, and on terms that allowed the family to move forward without further contentious proceedings. The trust's governance arrangements were also revised as part of the settlement to reduce the risk of similar disputes arising in future.
