If you are involved in a dispute over trust administration, you should look to the terms of the trust deed to determine which court can hear the dispute. Often, the trust will specify which country's laws apply. Sometimes, the trust deed may specify a venue in which the dispute should be heard. When trusts do not specify which law to use, conflict of laws provisions may apply.
People involved in a trust dispute in The Bahamas or relating to The Bahamas will need to consider the specific Bahamian conflict of laws provisions regarding trusts. Most importantly, The Bahamas does not allow any heirship rights with respect to trusts. Heirship rights means rights possessed by people with personal relationships to the trust settlor (creator) or beneficiaries that some foreign laws create. Specifically, the Trusts (Choice of Governing Law) (Amendment) Act 2016 states that The Bahamas does not recognize these rights.
The Trusts (Choice of Governing Law) Act 1989 gives effect to any provisions in a trust that specify using the laws of The Bahamas to interpret or govern the trust. If the trust states that the law of The Bahamas governs one portion of a trust or that The Bahamas is the appropriate forum to administer the trust, this is conclusive evidence that the settlor wanted Bahamian law to govern the trust. If the trust does not so indicate, courts should consider the terms of the trust and the intent of the parties first in determining which country's laws apply.
If the trust includes real property in The Bahamas, or personal property located anywhere in the world that is part of a Bahamian trust corpus, a court is more likely to find that Bahamian law should govern. However, if the trust corpus includes property located elsewhere, the determination can be less clear. In general, if the trust terms and parties' intent indicate that Bahamian laws apply, the Supreme Court of the Bahamas likely will be the most appropriate venue. Under the Trust (Choice of Governing Law) Act, Bahamian law will then decide all disputes regarding the settlor's capacity, trust validity, trust administration, powers of revocation, and more.
As you can see, the answer to the question “can our trust dispute be decided outside The Bahamas?” is not straightforward. First, look to the terms of the trust, and seek advice from a qualified attorney regarding the specific trust at issue.
To find out more about trust disputes and conflict of laws, visit Gonsalves-Sabola Chambers online or call the office at +1 242 326 6400.