What Issue: Surrogacy and the Longleat family trusts

The recent decision of Cator & Ors v Thynn & Anor [2026] EWHC 209 (Ch) raises interesting issues for trustees when considering what would be the meaning of the word “child” in family trusts where a child is born by way of surrogacy.

The decision follows an application brought by the trustees of three family trusts which are connected to the Longleat estate in Wiltshire: the Longleat House and Chattels Settlement, Lord Bath’s Own Longleat Settlement and Lord Bath's Longleat Settlement (Ceawlin's Fund) (the Trusts).The first two of the Trusts are now held on the trusts of the third. The first defendant to the application, the Eighth Marquess of Bath, is the life tenant of the third of the Trusts.

The factual background to the application is as follows. The Eighth Marquess of Bath married Emma Thynn, the current Marchioness of Bath, in 2013. They have two children together, John (born in 2014) and Henry (born in 2016). Henry, although a biological child of the Marquess and Marchioness of Bath, was born by way of surrogacy and was delivered at a private clinic in the United States.

Due to the circumstances of Henry’s birth, a question arose as to whether Henry could benefit from the Trusts. The Trusts expressly retain common law meanings of descriptions of beneficiaries, such as “child”, “grandchild” and “issue”. In the case of a child born by surrogacy, the common law position is, crudely, that “the status of the child is in law the same as that of a child conceived in adultery” (as approved in Re M (Child Support Act: Parentage) [1997] 2 F.L.R. 90). The effect of this was that Henry would not, under the common law position, be perceived to be a legitimate child and could not therefore benefit.

Accordingly, the trustees had made an application for the Court’s approval of their decision to exercise a power of advancement in favour of the Marquess of Bath, in order to confer a power for him to add Henry to the class of beneficiaries. A power of advancement enables a trustee to provide trust capital to a beneficiary in order to provide him/her with some permanent benefit. Practically speaking, the proposal was to advance trust assets on trusts which mirror the existing Trusts, but which include the power to add Henry and any of his issue and their respective spouses, widows or widowers, to the class of beneficiaries.

The judgment makes clear that there was no intention for such a power conferred on the Marquess of Bath to be exercised as of yet, due to possible US tax implications given that Henry was born in the USA.

The hearing before HHJ Matthews was to deal with a procedural question of the joinder of an independent lawyer as representative on behalf of various beneficiaries of the Trusts. The judgment does not therefore deal with the substantive relief sought in the main application (being the approval of the proposed exercise of trustee power), however HHJ Matthews does offer some interesting history and background as to the evolution of the law in applications for the Court’s approval under what is now often referred to as the Public Trustee v Cooper [2001] WTLR 901 jurisdiction, and explores the impact of the recent English Court of Appeal case Denaxe Ltd v Cooper [2024] Ch.65.

HHJ Matthews considers the conclusions of Snowden LJ, Asplin LJ and Falk LJJ in Denaxe and in particular the finding that “the concept of ‘immunity’ flowing from an approval decision is most easily understood as judicial shorthand for the bar on subsequent proceedings that results from an issue estoppel” and that “if the judge hearing the approval application determines a particular issue as a step in deciding to give his approval, that will operate as a bar to a party to the application…seeking to relitigate that issue in subsequent proceedings”. As found by the Justices in Denaxe, “it is an essential requirement of issue estoppel that the claimant in the second set of proceedings should also have been a party (or a privy of a party) to the earlier decision”.

In reaching his conclusion in the decision, HHJ Matthews records that he was satisfied that the legal representative appointed to represent the class of beneficiaries was appropriate and ultimately, necessary and that the role of this representative would be “to represent the interests of those members of the class of beneficiaries who would be potentially prejudiced by the implementation of the trustees' decision, so as to be able to provide an appropriate argument against such implementation.” 

The case raises not only interesting points arising in the context of trust structures – such as how should the class of beneficiaries be construed and possible extra-jurisdictional tax issues – but also explores the ramifications of the Denaxe decision and the impact which it has on trustees seeking the approval of the Court.