Deed of Arrangement (Variation of Trust) (ON)

Summary

This precedent is a deed of arrangement in which the beneficiaries unanimously consent to vary the terms of a trust. It contains practical guidance and drafting notes. Generally, the terms of a trust cannot be varied by the Trustee or beneficiaries. However, there are two exceptions. The first exception is the common law rule established by the court in the case of Saunders v. Vautier, [1841] C.C.S. NO. 14 ("Saunders"). The second exception is the statutory authority granted to the court to vary trusts, for which authority is found in Ontario's Variation of Trusts Act, R.S.O. 1990, c. V.1 ("Act"). If allowed by the terms of the trust instrument, all beneficiaries entitled to share must agree. The beneficiaries can demand the trust to be terminated and for the trust to be distributed to them in the agreed upon proportions. For more on variations of trusts, see the practice notes: Inter Vivos and Testamentary Trusts: Formalities and Requirements (ON), Authority (Trust Termination or ...