Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Administration definition

What does Administration mean? Administration is a corporate insolvency procedure used to protect and stabilise a financially distressed company while an independent insolvency practitioner (the administrator) takes control to pursue rescue or a better return to creditors than liquidation. It is a statutory process in England and Wales and Scotland under the Insolvency Act 1986, Schedule B1, and in Northern Ireland under the Insolvency (Northern Ireland) Order 1989, Schedule B1. Key features include an immediate moratorium on most creditor enforcement, displacement of the directors’ management powers, and appointment either by court order or out of court by the company, its directors or...

Scope and limits of trustee indemnities, liens, releases on retirement and distribution, and exoneration clauses—practice and recent cases

Published by a LexisNexis Private Client expert

Practice notes

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This practice note sets out two mechanisms by which trustees can reduce exposure to personal liability arising from their office:

indemnities
exoneration clauses in trust instruments

Indemnities

Trustees may reimburse themselves from the trust fund for expenses incurred in performing their trustee functions. This spans administration costs, taxes connected to the trust fund, and contractual obligations. It can also extend to the costs of actions against third parties and trust litigation, but care is needed to ensure such legal expenses are payable from the fund rather than personally. A trustee’s right to be indemnified arises only where the costs were incurred:

properly, and
while acting in their capacity as trustee

In FMA v BBA, a case involving compromised trust proceedings, the trustees were refused an indemnity from the trust fund for costs incurred to advance their own interests rather than those of the beneficiary.

Distribution

When assets are distributed to a beneficiary, trustees lose their proprietary rights over the fund (subject to statutory provisions for trusts of land and strict settlements). Trustees may, therefore, request that any recipient beneficiary...

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Adam Carvalho

Adam Carvalho has more than 15 years' experience as a contentious Private Client lawyer. Most recently, he was a Legal Director in the Contentious Trusts and Probate Team at Myerson, where he worked on complex and high-value contentious trust and probate matters.Adam trained, qualified and worked as a senior associate and partner in a central London firm in the Tier 1 nationally for Contentious Trust and Probate work.Adam has considerable experience of ultra-high value litigation, cross-jurisdictional matters and disputes in non-UK courts. Adam has litigated in the Supreme Court, Court of Appeal, and advised in relation to complex matters in courts from Bermuda to New Zealand. Adam is known for his constructive, pragmatic advice, his down to earth approach, and his technical knowledge. Adam is a firm believer in focusing on the main issues and providing sound and accessible advice....

Web page updated on 28/05/2026

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