Breach of trust, a violation of duty by a trustee, executor, or other person in a fiduciary position.
In some cases a breach of trust may be a comparatively venial offence, arising from the trustee having honestly misconstrued the deed or will creating the trust either as to the persons entitled, or as to his powers of investment of or dealing with the trust property, or having otherwise erred in the discharge of his strict duty; in other cases he may have been guilty of negligence or carelessness involving at least some degree of moral blame; or, in other cases again, he may have committed some gross fraud. But in all these cases alike the trustee is personally responsible at the suit of the beneficiaries for any loss which may have resulted, and the rules of equity on the subject were extremely strict and were enforced with great severity by the Court of Chancery. In later times, however, the Court was not quite so astute in fixing honest trustees with liability for breach of trust as formerly; see Speight v. Gaunt, (1883) 9 App Cas 1. More recently, the Trustee Acts have relaxed the stringent rules of Equity in regard to trustees; their authority has been extended, their discretion has been widened; indemnities for innocent breaches of trust have been provided, and see generally, the Trustees Act, 1925. By s. 57 of this Act the Court may extend the powers of trustees in certain cases, and s. 61 ibid., replacing s. 3 of the (English) Judicial Trustees Act, 1896, empowers the Court, if a trustee has acted honestly and reasonably and ought fairly to be excused, to discharge him from liability.
Further, the Trustee Act, 1888, s. 8, allows a trustee to plead the Statute of Limitations except incases of fraud or if he has not benefited by the breach of trust; see LIMITATIONS.
A breach of trust was not a criminal offence until 20 & 21 Vict. c. 54. It is now punishable, by the (English) Larceny Act, 1916, s. 21. As a misdemeanour, with penal servitude not exceeding seven years; but no prosecution can be commenced without the sanction of the Attorney-General, or, if civil proceedings have been started by the prosecutor, without the sanction of the Court before whom the proceedings have been or are pending. Consult Lewin, Godefroi, or Underhill on Trusts.
Means a breach by a trustee of the terms of a trust (as by stealing from or carelessly mishandling the funds), Webster's Dictionary of Law, Indian Edn. (2005), p. 58.
Means a trustee's violation of either the trust's terms or trustee's general fiduciary obligations, the violation of a duty that equity imposes on a trustee, whether the violation was wilful, fraudulent, negligent, or inadvertent. A breach of trust subjects the trustee to removal and creates personal liability, Black Law Dictionary, 7th Edn., p. 183.
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