Perpetuities and Accumulations Bill [HL]

House of Lords

Session 2008 - 09
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Other Bills before Parliament

Perpetuities and Accumulations Bill [HL]

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Pre-commencement instruments: period difficult to ascertain
(1)
If—
(a)
an instrument specifies for the purposes of property limited in trust a
perpetuity period by reference to the lives of persons in being when the
instrument takes effect,
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(b)
the trustees believe that it is difficult or not reasonably practicable for
them to ascertain whether the lives have ended and therefore whether
the perpetuity period has ended, and
(c)
they execute a deed stating that they so believe and that subsection (2)
is to apply to the instrument,
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that subsection applies to the instrument.
(2)
If this subsection applies to an instrument—
(a)
the instrument has effect as if it specified a perpetuity period of 100
years (and no other period);
(b)
the rule against perpetuities has effect as if the only perpetuity period
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applicable to the instrument were 100 years;
(c)
sections 6 to 11 of this Act are to be treated as if they applied (and
always applied) in relation to the instrument;
(d)
sections 1 to 12 of the Perpetuities and Accumulations Act 1964 (c. 55)
are to be treated as if they did not apply (and never applied) in relation
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to the instrument.
(3)
A deed executed under this section cannot be revoked.
Accumulations
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Abolition of restrictions
These provisions cease to have effect—
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(a)
sections 164 to 166 of the Law of Property Act 1925 (c. 20) (which
impose restrictions on accumulating income, subject to qualifications);
(b)
section 13 of the Perpetuities and Accumulations Act 1964 (which
amends section 164 of the 1925 Act).
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Restriction on accumulation for charitable trusts
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(1)
This section applies to an instrument to the extent that it provides for property
to be held on trust for charitable purposes.
(2)
But it does not apply where the provision is made by a court or the Charity
Commission for England and Wales.
(3)
If the instrument imposes or confers on the trustees a duty or power to
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accumulate income, and apart from this section the duty or power would last
beyond the end of the statutory period, it ceases to have effect at the end of that
period.
(4)
The statutory period is a period of 21 years starting with the first day when the
income must or may be accumulated (as the case may be).
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(5)
If a duty or power ceases to have effect under this section the income to which
the duty or power would have applied apart from this section must—

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(a)
go to the person who would have been entitled to it if there had been
no duty or power to accumulate, or
(b)
be applied for the purposes for which it would have had to be applied
if there had been no such duty or power.
(6)
This section applies whether or not the duty or power to accumulate extends
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to income produced by the investment of income previously accumulated.
Application of statutory provisions
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Application of this Act
(1)
Sections 1, 2, 4 to 11, 13 and 14 apply in relation to an instrument taking effect
on or after the commencement day, unless it is a will executed before that day.
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(2)
Section 12 applies (except as provided by subsection (3)) in relation to—
(a)
a will executed before the commencement day (whether or not it takes
effect before that day);
(b)
an instrument, other than a will, taking effect before that day.
(3)
Section 12 does not apply if—
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(a)
the terms of the trust were exhausted before the commencement day, or
(b)
before that day the property became held on trust for charitable
purposes by way of a final disposition of the property.
(4)
The commencement day is the day on which this Act comes into force.
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Limitation of 1964 Act to existing instruments
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In section 15 of the Perpetuities and Accumulations Act 1964 (c. 55) the
following subsections are inserted after subsection (5) (which makes provision
as to the instruments to which the Act applies)—
“(5A)
The foregoing sections of this Act shall not apply in relation to an
instrument taking effect on or after the day on which the Perpetuities
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and Accumulations Act 2009 comes into force; but this shall not prevent
those sections applying in relation to an instrument so taking effect if it
is a will executed before that day.
(5B)
Subsection (5A) above shall not affect the operation of sections 4(6) and
11(2) above.”
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General
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The Crown
(1)
This Act does not extend the application of the rule against perpetuities in
relation to the Crown.
(2)
Subject to that, this Act binds the Crown.
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18
Rule as to duration not affected
This Act does not affect the rule of law which limits the duration of non-
charitable purpose trusts.

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Provision made otherwise than by instrument
If provision is made in relation to property otherwise than by an instrument,
this Act applies as if the provision were contained in an instrument taking
effect on the making of the provision.
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Interpretation
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(1)
For the purposes of this Act this section contains provisions relating to the
interpretation of these expressions—
(a)
power of appointment, general power of appointment and special
power of appointment;
(b)
relevant pension scheme;
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(c)
taking effect (in relation to a will);
(d)
will.
(2)
A power of appointment includes—
(a)
a discretionary power to create a beneficial interest in property without
the provision of valuable consideration;
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(b)
a discretionary power to transfer a beneficial interest in property
without the provision of valuable consideration.
(3)
Section 11 applies to interpret references to a general or special power of
appointment.
(4)
Each of these is a relevant pension scheme—
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(a)
an occupational pension scheme;
(b)
a personal pension scheme;
(c)
a public service pension scheme.
(5)
The expressions in subsection (4)(a) to (c) have the meanings given by sections
1 and 181(1) of the Pension Schemes Act 1993 (c. 48).
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(6)
An instrument which is a will takes effect at the testator’s death.
(7)
A reference to a will includes a reference to a codicil.
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Repeals
The enactments mentioned in the Schedule are repealed to the extent specified,
but subject to the provision at the end of the Schedule.
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Commencement
(1)
This section and sections 23 and 24 come into force on the day on which this
Act is passed.
(2)
The other provisions of this Act come into force on such day as the Lord
Chancellor may appoint by order made by statutory instrument.
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Extent
This Act extends to England and Wales only.

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Short title
This Act may be cited as the Perpetuities and Accumulations Act 2009.