The Singapore Court of Appeal has handed down its Judgment in the long running trust dispute between the former prime minister of Georgia, Mr Ivanishvili, and Credit Suisse Trust in Ivanishvili v Credit Suisse Trust Ltd [2024] SGCA(I) 5.

The Court of Appeal’s Judgment affirms the Singapore International Court’s findings (in Ivanishvili v Credit Suisse Trust Ltd [2023] 5 SLR 59) on liability and contains a damning assessment of Credit Suisse Trust’s conduct in failing to safeguard the trust assets from unauthorised and fraudulent dealing. The Court remarked that “To describe CS Trust’s response as desultory or lackadaisical would be charitable” and found that the trustee had preferred Credit Suisse’ commercial interests over those of the beneficiaries. The Court also agreed that it was appropriate to award the claimants the difference between the actual performance of the whole portfolio of trust assets and the performance that would have been achieved in a hypothetical properly managed portfolio. 

The Judgment is significant to the trust industry in the following respects:

• The Court considered the nature of the fiduciary duty to act in good faith, finding that it qualifies the exercise of the trustee’s non-fiduciary duties or powers, and additionally, requires trustees to act in circumstances where it knows that the interests of the beneficiaries are at risk of harm (at [47] and [48]).
• The Judgment confirms that the scope of duty principle has no application to breaches of fiduciary duty (at [66]). 
• The Court made obiter remarks on the availability of contributory negligence to a claim for breach of fiduciary duty, noting that “it is difficult to square the concept of contributory negligence with breaches of fiduciary duty” (at 68).

Guidance is provided on the principles to be applied when assessing losses for breach of fiduciary duty (at [87] and [91]).  

Sophie Holcombe and Jamie Randall acted for the successful Respondents to the appeal with Drew & Napier LLC and David Halpern KC, instructed by Blake Morgan (Sarah Rees, Conor Daly and Alex Lepretre).

To read the judgment, please click here.