Law Commission’s 14th Programme of Reform: the future of Trust Arbitration?
On 4 September 2025, the Law Commission of England and Wales[i] announced its 14th Programme of Law Reform, an important ongoing project focused on trust law arbitration. This initiative marks a significant step towards modernising the resolution of trust disputes.
Trust Arbitration: Current Landscape
Arbitration offers several compelling advantages for resolving trust disputes. It is especially beneficial for "internal" disputes, which involve parties directly connected to the trust such as settlors, trustees, beneficiaries, or other parties with vested interests in the trust property, rather than external third parties. In particular:
- Confidentiality - confidential arbitration proceedings are particularly appealing to family offices, beneficiaries, and trustees seeking to resolve sensitive issues discreetly. In jurisdictions where obtaining privacy and confidentiality orders from courts is challenging, arbitration is a valuable tool to minimise publicity and protect the reputations of those involved and to protect minor children and young adults from the impact of public exposure of family wealth.
- International enforceability of arbitral awards under the 1958 New York Convention enhances the appeal of arbitration for trust disputes, especially when trust assets span multiple jurisdictions.
The growing interest in arbitration for trust disputes is evident, and several jurisdictions, notably the DIFC, the Bahamas, Guernsey, and various US states, have already legislated to recognise arbitration as a suitable forum for trust disputes. The International Chamber of Commerce (ICC), a leading arbitral institution, further underscored this trend by updating its arbitration clause for trust disputes in 2019.
Despite advancements elsewhere, English law currently imposes significant limitations on the use of arbitration for trust disputes, as it does not recognise arbitration clauses within trust instruments as valid and enforceable for disputes between trustees and beneficiaries. While beneficiaries can pursue arbitration through separate agreements with trustees, challenges remain concerning the enforceability of arbitral awards.
Law Commission Reform: Trust Arbitration Expansion?
The Law Commission's 14th Programme of Reform aims to address these limitations by reviewing the legal framework surrounding trust law arbitration. It will explore potential reforms to facilitate arbitration in trust disputes, excluding disputes over the validity of the trust disposition itself. A key focus will be considering how creditors and minor, unborn or incapacitated beneficiaries can be bound by arbitral awards.
Although the project is at an early stage, its inclusion in the Law Commission's programme, following a reference from the Ministry of Justice, signals a growing judicial and legislative interest in expanding arbitration's role in trust disputes. This development reflects public demand for more efficient and private dispute resolution mechanisms.
While the future of trust arbitration under English law remains uncertain, we are cautiously optimistic about its potential expansion. As the Law Commission’s project progresses, we will continue to monitor developments. In the meantime, if you need trust dispute resolution advice, the team here at Charles Russell Speechlys would be delighted to assist.
[i]Established in 1965, the Law Commission is an independent organisation responsible for reviewing the law of England and Wales and recommending necessary reform.
