Court Revisits Confidentiality Orders In Wake Of The Paradise Papers

In the matter of G Trust [2017] SC (Bda) 98 Civ (15 November 2017)

In the 2015 case of Re BCD Trust (confidentiality Order) [2015] Bda LR 208, the Chief Justice had confirmed that with respect to administration of trust cases, proceedings could be anonymised and dealt with as private applications where there was no obvious public interest in knowing about an internal trust administration matter.

In a recent ruling from November 2017, the Chief Justice has re-confirmed his previous finding with respect to confidentiality orders in the context of trust administration matters.

His ruling was prepared after the release of the so-called "Paradise Papers". The Chief Justice had very much in mind whether the popular onshore attacks on offshore 'secrecy' undermined in any way the validity of this Court's previous practice in this regard. After a detailed consideration of the factors justifying the granting of a confidentiality order, the Chief Justice found as follows:

"The present proceedings concern the internal administration of a private trust into which the general public have no right to pry. Persons administering, interested in or settling Bermuda trusts should rest assured that this Court's firmly established practice of making confidentiality orders in appropriate cases, which is merely designed to enable law -abiding citizens to peaceably enjoy their actual and contingent property rights, has a venerable legal basis. The existing practice will continue to be applied in appropriate cases such as the present."

The ruling then went on to address the substantive issue of how Section 18A to D of Children Act 1998 (as amended by the Children Amendment Act 2002) ("the Children Act") impacts foreign law trusts when the governing law of that trust is changed to the law of Bermuda.

In a previous decision this year (In the Matter of A Trust (Change of Governing Law) [2017] SC (Bda) 38 Civ) ("Re A Trust"), the Chief Justice ruled that the governing law of a foreign law trust could be changed to Bermuda law without triggering the application of the Children Act and any instruments executed under it.

Revisiting Re A Trust, it was held that there was no proper basis for finding that the Children Act provisions were intended to have indirect retrospective effect on a settlement made under a foreign governing law which, post -2004, became governed by Bermuda law via an indirect route. It followed that the Children Act provisions did not apply to...