Talk:Nestle v National Westminster Bank plc
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Case analysis on the Court of Appeal Decision
editI believe the analysis in the relation to the Court of Appeal decision is incorrect.
Per Staughton LJ's judgment:
The trustees...continually misunderstood [the investment clause], and there is nothing to show that they ever understood it correctly.
The trustees failed to conduct regular periodic reviews of the investments. From 1922 to 1959 there was only one change of an investment, other than changes which were forced on the trustees by rights issues or because a security reached its redemption date. Seeing that there were 53 holdings in the original portfolio, including a number which sooner or later must have become of little value except as wallpaper
However, the misunderstanding of the investment clause and the failure to conduct periodic reviews do not by themselves, whether separately or together, afford Miss Nestle a remedy. They were symptoms of incompetence or idleness - not on the part of National Westminster Bank but of their predecessors; they were not without more breaches of trust. Miss Nestle must show that, through one or other or both of those causes, the trustees made decisions which they should not have made or failed to make decisions which they should have made. If that were proved, and if at first sight loss resulted, it would be appropriate to order an enquiry as to the loss suffered by the trust fund.
Can someone double-check this?