The ‘X Trusts’ Case – The Privy Council Confirms Protectors May Have a Substantive Fiduciary Role

On 19 March 2026, the Judicial Committee of the Privy Council delivered its judgment in A and Ors (Appellants) v C and others (Respondents) [2026] UKPC 11, overturning the Bermuda Court of Appeal and holding that the protectors of the X Trusts had the “wider” role, rather than a narrow supervisory one.

The decision has been closely watched by trust practitioners globally as it resolves a long-running uncertainty, namely, where a trust instrument requires protector consent as a condition to exercise a trustee power but the trust instrument is silent on how such consent is to be exercised, is the protector (a) confined to reviewing the rationality and legality of the trustees’ proposed decision, or (b) may the protector exercise an independent judgment on the merits?

The Privy Council has now made clear that, absent express language imposing narrower constraints in the trust instrument, the protector is not limited to acting as a mere watchdog. A protector may instead have a substantive fiduciary role to play and may withhold consent based on its own independent assessment of the merits of any trustee proposal.

Key takeaways

The decision suggests that where a trust instrument does not expressly limit the protector’s role, a fiduciary protector’s consent power will usually (subject to the terms of the trust instrument) be interpreted as a wider one. The court will not rush in to fill drafting silence with an implied narrow duty.

For existing trusts, trustee and protector provisions should be reviewed carefully. For new trusts, drafting should expressly state whether the protector is intended to have a narrow supervisory role or a wider fiduciary one.

Action points

For trustees

• Review the protector consent provisions in existing trust instruments to try to identify whether such powers are of a ‘narrow’ or ‘wide’ variety.
• If the protector powers in the trust instruments are silent or unclear, consider implementing clarifying amendments where possible.
• If the protector powers are silent or unclear, assume they are of the ‘wide’ variety.
• Keep a clear record of all protector interactions.

For protectors

• Ascertain whether the protector powers are of the ‘narrow’ or ‘wide’ variety and carry out your duties accordingly.
• If the powers are silent or unclear, consider implementing clarifying amendments to the trust instrument wherever possible in concert with the trustee.
• If the powers are silent or unclear assume they are of the ‘wide’ variety.
• Keep a clear record of trustee interactions.

For settlors

• Ensure the powers vested in protectors clearly indicate whether they are of the ‘wide’ or ‘narrow’ variety.
• Ensure there are deadlock-provisions in the trust instrument in the event a protector and a trustee cannot find common ground on any proposed course of action.
• Ensure any proposed protector fully understands the nature of their role, the expected duties, as well as their fiduciary responsibilities if their powers vested in them are of the ‘wide’ variety.

The facts and procedural history

In 2017, the trustees of the X Trusts developed proposals concerning the future of the trusts. Certain aspects of these proposals necessitated protector consent. After consultation, the protectors took the view that the proposals were unlikely to serve the beneficiaries’ best interests, and withheld consent. They approached the matter on the basis that their duty was of the wider variety and not a mere ‘rubber stamp’.

In June 2020, the Bermuda-based trustees applied to the Supreme Court of Bermuda for the court’s blessing of their preliminary proposals under the Public Trustee v Cooper route. One branch of beneficiaries and the protectors opposed the application, arguing that if protector consent was unlikely, further expense would be unjustified.

The trustees then sought declarations from the Supreme Court of Bermuda as to the basis on which the protectors could withhold consent, and specifically whether the protectors’ function was narrow or wider. One beneficiary branch argued for the narrow role and another for the wider role; the trustees and protectors remained neutral. On 22 November 2021, the Supreme Court of Bermuda held that the protectors had only a narrow role. That conclusion was upheld by the Bermuda Court of Appeal in February 2023.

In doing so, the Court of Appeal declined to follow the Jersey Royal Court’s reasoning in In the matter of Piedmont Trust & Riviera Trust [2021] JRC 248, where materially similar trust wording had been interpreted as conferring a wider role on the protector.

The Privy Council’s reasoning

The Privy Council rejected the framing of the issue as a simple binary choice between two default models. Instead, it held that the correct question was what constraints, if any, the trust instrument actually imposed on the protector, read in context and together with the general law.

That approach mattered. The trust deeds conferred clearly defined powers on the protectors, but were silent as to how those powers should be exercised. The Privy Council held that this silence did not justify implying a narrow restriction. On the contrary, where a settlor has deliberately created fiduciary offices and specified powers without prescribing a detailed decision-making standard, that gap may well be intentional.

Relying on principles approved in Attorney General of Belize v Belize Telecom Ltd. [2009] UKPC 10, the Privy Council held that if the settlor had intended something further to happen, the instrument would ordinarily have said so. An apparent gap may therefore be a deliberate gap, reflecting a choice to trust the good sense of fiduciaries rather than constrain them with detailed rules.

The Privy Council found nothing in the X Trusts’ deeds that supported the narrow role. By contrast, several features supported the wider role.

First, the deeds permitted the protector powers to be released or waived. That was difficult to reconcile with the suggestion that the protectors were simply there to police legality. As the Privy Council noted, it would be unusual to permit a “watchdog” to abdicate that function permanently.

Secondly, where there was more than one protector, unanimous consent was required; failing unanimity, the trustees could proceed without protector consent so long as they consulted the protectors and took their views into account. The Privy Council considered that structure consistent with protectors having an independent evaluative role. It made little sense if a protector’s task were merely to identify unlawfulness.

Thirdly, consent was required only for a limited category of especially important acts, including appointments of capital and dealings with specified securities. That selective allocation of consent rights strongly suggested that the settlor intended the protectors to exercise real judgment in relation to major decisions.

The Privy Council also emphasised that fiduciary status does not itself narrow the protector’s function. A fiduciary protector must avoid conflicts and exercise powers for proper purposes, but those duties are entirely consistent with a wider role.

Deadlock and practical significance

The Bermuda Court of Appeal had been concerned that a wider role risked duplication and deadlock. The Privy Council rejected that as a reason to prefer the narrow interpretation. The very purpose of a protector with meaningful consent rights may be to stop a major transaction that the protector considers inappropriate. The possibility of deadlock was therefore contemplated.

If you are a concerned trustee, protector or settlor, please reach out to Robert Mack or Hilary Brooks who would be pleased to guide you.