Case Details
- Citation: [2021] SGCA 33
- Court: Court of Appeal of the Republic of Singapore
- Date: 9 April 2021
- Case Title: CHAN YUN CHEONG (Trustee of the Will of the Testator) v CHAN CHI CHEONG (Trustee of the Will of the Testator)
- Civil Appeal No: Civil Appeal No 63 of 2020
- Originating Summons: Originating Summons No 703 of 2019 (HC/OS 703/2019)
- Statutory Provisions in Issue: Section 14 of the Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed); s 40 of the Trustees Act (Cap 337, 2005 Rev Ed)
- Rules of Court Provision: Order 80 of the Rules of Court (Cap 322, R 5, 2014 Rev Ed)
- Judges: Judith Prakash JCA, Chao Hick Tin SJ and Belinda Ang Saw Ean JAD
- Appellant/Defendant: Chan Yun Cheong (Trustee of the Will of the Testator)
- Respondent/Plaintiff: Chan Chi Cheong (Trustee of the Will of the Testator)
- Legal Area: Trusts — Trustees — Retirement
- Statutes Referenced: Supreme Court of Judicature Act; Trustees Act
- Cases Cited: [2011] SGHC 139; [2020] SGHC 43; [2021] SGCA 33
- Judgment Length: 36 pages, 10,855 words
Summary
In Chan Yun Cheong (trustee of the will of the testator) v Chan Chi Cheong (trustee of the will of the testator) ([2021] SGCA 33), the Court of Appeal addressed a practical but legally technical dispute: whether a trustee who wishes to retire under an express clause in the will must still comply with the statutory retirement mechanism in s 40 of the Trustees Act, and whether the court can compel a non-consenting co-trustee to execute the necessary deeds.
The Court of Appeal upheld the High Court’s approach. It held that, absent a contrary intention in the trust instrument, the statutory conditions in s 40 of the Trustees Act govern a trustee’s retirement. On the facts, the will clause did not evince such a contrary intention. Accordingly, the appellant could not validly retire by letter alone, and the court could order the appellant to provide the required consent and execute the deeds to give effect to the respondent’s retirement.
The decision is significant for trustees and trust practitioners because it clarifies the interaction between statutory trustee powers and the terms of a will, and it confirms that courts will not allow trustees to frustrate trust administration by withholding consent unreasonably where the statutory prerequisites for retirement are engaged.
What Were the Facts of This Case?
The dispute arose from a trust created by the will of the late grandfather, Chan Wing (the “Testator”), dated 5 February 1947. The Testator died a few weeks later, and his sons became trustees of his estate, which included assets located in Malaya and Singapore. Over time, trustees died or purported to retire, and replacements were appointed. The trust therefore had a continuing need for properly constituted trustees to manage and administer the trust assets.
Two trustees became central to the litigation: the appellant, Chan Yun Cheong, and the respondent, Chan Chi Cheong. By June 2003, the trust had three trustees: Chan Chee Chiu (“CCC”), Chan See Chuen, and Chan Fatt Cheung (“CFC”). In March 2009, CFC resigned as trustee. Notably, no deed of retirement was executed at that time, although the remaining trustees accepted the resignation as effective. In April 2017, CCC died. In June 2017, the remaining trustee appointed the appellant and respondent as co-trustees by deed, restoring the number of trustees to three.
After the appointment, disagreements emerged concerning the stewardship of the trust assets. On 10 January 2019, the respondent’s solicitors wrote to CCC’s solicitors to inform them that the respondent intended to retire and attached an unsigned draft deed of retirement (“Draft Deed”). CCC’s solicitors responded on 15 January 2019, stating that CCC had no objections and returning the Draft Deed with CCC’s signature appended. The respondent’s solicitors then wrote to the appellant on 16 January 2019, asking for the appellant’s consent and enclosing the relevant documents.
The appellant refused to sign the Draft Deed. Instead, on 1 February 2019, he sent a letter (“Resignation Letter”) to the respondent and CCC, stating that he resigned as trustee with immediate effect. He explained that he could not effectively discharge his duties due to concerns, including a disagreement about a fund transfer allegedly carried out without his authorisation. On 19 February 2019, the respondent’s solicitors replied that the appellant remained a trustee and would remain so until a proper deed of retirement was executed. The appellant maintained that the will permitted resignation without formalities or the consent of other trustees, and he pointed to the earlier example of CFC’s resignation without a deed.
What Were the Key Legal Issues?
The case raised two core legal questions. First, the court had to determine the operative mode of trustee retirement under the will: did the will’s express clause permit resignation by letter without complying with the statutory requirements, or did s 40 of the Trustees Act still apply?
Second, assuming the statutory conditions applied, the court had to decide whether the appellant could be compelled to provide the required consent and execute the deeds necessary to effect the respondent’s retirement. This required the court to consider its powers under the Supreme Court of Judicature Act and the procedural framework for compelling execution of documents, including whether the court could order the appellant to sign or otherwise give effect to the deeds.
Underlying both issues was a broader trust administration concern: if a trustee could unilaterally retire in a manner that bypasses statutory safeguards, co-trustees could be left unable to manage the trust properly, and the trust’s continuity could be jeopardised. Conversely, if statutory conditions always applied regardless of the will’s terms, trustees might be trapped in office even where the will suggests a more flexible mechanism.
How Did the Court Analyse the Issues?
The Court of Appeal agreed with the High Court’s framing of the issues and its analytical structure. The central interpretive task was to determine whether the will contained a “contrary intention” such that the statutory retirement power in s 40 of the Trustees Act would not apply. The Court emphasised that trusteeship is a serious appointment with responsibilities, and that retirement is not a matter of convenience or unilateral action; it must follow the legal framework and the trust instrument.
To resolve the first issue, the court considered s 2(2) of the Trustees Act, which provides that the powers conferred by the Act apply in so far as the trust instrument does not express a contrary intention. The Court treated s 40 as a “power” within the meaning of s 2(2). Therefore, unless the will expressed a contrary intention, s 40 governed the retirement process. The appellant argued that cl 3 of the will authorised resignation without formalities and without the consent of other trustees. The respondent argued that the will clause could not be read as displacing s 40, particularly because it did not address key matters such as the mode of retirement, the need for consent, and the practical consequences for trust administration.
On the objective reading of cl 3, the Court of Appeal found that nothing in the clause implied that the Testator intended to void or displace s 40. Clause 3 stated that upon the death or retirement of any trustee, the successor would be the Testator’s male descendant through a male line, and that if any trustee disagreed with the others or had to attend to other business, he was at liberty to resign and the vacancy would be filled accordingly. However, the Court held that this language did not amount to a contrary intention regarding the statutory mechanism for retirement. In other words, the will addressed the consequences of retirement (succession and filling vacancies) but did not clearly prescribe a different legal method for effecting retirement.
The Court also addressed the appellant’s reliance on the earlier resignation of CFC in 2009 without a deed. While the High Court had noted that CFC’s resignation did not comply with s 40, the parties had acted on the basis that CFC was no longer a trustee from the time of his resignation. The Court of Appeal accepted that such conduct could have practical implications in some contexts, but it did not treat that historical episode as determinative of the legal requirements for the appellant’s retirement. The Court’s reasoning reflects a careful distinction between (i) how parties may have acted in the past and (ii) what the law requires for a trustee to retire going forward.
On the second issue, the Court of Appeal considered whether the court could compel the appellant to consent and execute the deeds. The respondent had sought orders based on s 18 of the Supreme Court of Judicature Act read with the relevant item in the First Schedule, as well as the court’s inherent powers and, alternatively, directions enabling execution by the Registrar under s 14(1) of the SCJA. The Court’s analysis proceeded from the premise that the appellant remained a trustee because he had not met the conditions prescribed by s 40. If the appellant’s refusal prevented the statutory retirement process from being completed, then the court could intervene to ensure the trust’s administration was not obstructed.
Although the appellant argued that there was no basis to compel him to sign, the Court’s reasoning emphasised that trustees cannot withhold consent in circumstances where the statutory prerequisites for retirement are satisfied and where the refusal would frustrate the trust’s functioning. The Court treated the consent requirement in s 40 as a legal condition, not a discretionary veto. Where the remaining trustees consent and the deed is properly prepared, the court may order execution to give effect to retirement rather than allow one trustee to hold the trust hostage.
The Court also considered the appellant’s estoppel argument. The appellant contended that the respondent and CCC had accepted CFC’s resignation without a deed, which constituted a representation that resignation by letter was effective, and that the appellant relied on this to his detriment. The Court’s approach indicates that estoppel cannot be used to override clear statutory requirements where the law prescribes formalities for retirement. Even if parties acted informally in the past, the Court was not prepared to treat that as creating a legal right for the appellant to retire outside the statutory framework.
What Was the Outcome?
The Court of Appeal dismissed the appeal and affirmed the High Court’s orders. It held that the appellant had not validly retired because he did not comply with s 40 of the Trustees Act. Consequently, the appellant was required to provide his consent and execute the deeds necessary to confirm and effect the respondent’s retirement.
Practically, the decision ensured that the trust could continue to be administered by properly constituted trustees. It also clarified that trustees who wish to retire must follow the statutory deed-and-consent mechanism unless the trust instrument clearly and objectively displaces it.
Why Does This Case Matter?
Chan Yun Cheong v Chan Chi Cheong is an important authority on the relationship between trust instruments and statutory trustee powers in Singapore. For practitioners, the case demonstrates that courts will apply the Trustees Act’s default mechanisms unless the will or trust deed expresses a contrary intention with sufficient clarity. General statements that a trustee is “at liberty to resign” will not necessarily displace statutory formalities, especially where the will does not address the legal method of retirement and the consequences for trust administration.
The decision also has direct procedural and remedial value. It confirms that courts can order a non-consenting trustee to execute retirement-related deeds, and it supports the view that consent requirements in statutory trust provisions are enforceable conditions. This is particularly relevant in disputes where trustees disagree about governance, asset management, or alleged breaches, and one trustee attempts to exit office in a way that would otherwise stall the appointment of replacements.
Finally, the case serves as a cautionary tale for trustees and advisers. Informal retirements in the past—such as resignations by letter without a deed—may not reliably establish a legal precedent for future retirements. Practitioners should therefore ensure that retirement is effected through the correct legal instruments, and that any reliance on historical practice is carefully assessed against the statutory framework.
Legislation Referenced
- Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed), including ss 14(1) and 18 and the First Schedule (item 14)
- Trustees Act (Cap 337, 2005 Rev Ed), including s 2(2) and s 40
- Rules of Court (Cap 322, R 5, 2014 Rev Ed), including Order 80
Cases Cited
- [2011] SGHC 139
- [2020] SGHC 43
- [2021] SGCA 33
Source Documents
This article analyses [2021] SGCA 33 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the full judgment for the Court's complete reasoning.