Development of Trust Property

Querist : Anonymous (Querist) 29 April 2011 This query is : Resolved
X created a trust with respect to one of the properties he owned and the beneficiaries named therein were his grandsons namely A and B (sons of Y). X & Y were the trustees. As the income of the trust property was not sufficient and the trust was earning a loss, X filed an application u/s 36 of the Trust Act and obtained the necessary permission to develop the said property to prevent loss and injury to the estate. However before the property could be developed X expired.

The trust deed mentioned that on the expiry of A & B and in the absence of lineal descendants of A and B the property would vest in favour of C&D (sons of Z, another son of X.) or their lineal descendants.

Z, C & D filed a partition suit claiming half share with respect to the said property. The court granted an order of status quo.

In order to minimise the loss of the estate and to fulfill the desire of the settlor to develop the property, Y alongwith his co-trustee intends to get the property developed for the interest of A & B.

Under these circumstances:

1. Can the court stop the development of the said property?
2. Does Z, C or D has any valid claim at this stage?
3. What are the remedies available to Y or A and B so that the property could be developed so as to minimise loss of the estate and benefit of A & B which was the intention of the trust?

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R.Ramachandran (Expert) 29 April 2011
First one has to examine whether the property which Mr. X owned was his self-acquired property or ancestrol property.

M.Sheik Mohammed Ali (Expert) 29 April 2011
once again check it out whether ancestral or self earned

Guest (Expert) 29 April 2011
Legality of any action depends upon the status of the property, as pointed out by Mr. Ramachandran.

Devajyoti Barman (Expert) 29 April 2011
From the query it appears that the Trust is with regards to the self acquired property of x.
Now the circumstances is that X during his lifetime X obtained permission of the court to develop the same.
The said order not having been challenged by any one has attained finality.
So unless the said order of Leave of the court s set aside by any Superior court, the Development of the property by the current trustees can not be stopped.
During the lifetime of a & b, c,d or z do not have any semblance of right.
A and B can safely proceed with the development work.

M/s. Y-not legal services (Expert) 29 April 2011
yes.. agree with experts..

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