Section 33 of The Indian Trust Act, 1882
A person other than a trustee who has gained an advantage from a breach of trust must indemnify the trustee to the extent of the amount actually received by such person under the breach; and where he is a beneficiary the trustee has a charge on his interest for such amount. Nothing in this section shall be deemed to entitle a trustee to be indemnified who has, in committing the breach of trust, been guilty of fraud.
Summary
- A non-trustee who benefits from a trust violation must pay back the trustee up to the amount they actually received.
- If the person who gained from the trust violation is a beneficiary, the trustee can place a legal claim on that beneficiary's trust interest to recover the amount.
- A trustee cannot claim any payback or recovery under this section if they committed fraud during the trust violation.
Practical examples
FAQ
1. Who is required to compensate a trustee for a trust violation under Section 33 of the Indian Trusts Act, 1882?
Under Section 33 of the Indian Trusts Act, 1882, any person other than a trustee who gains an advantage from a trust violation must compensate the trustee up to the amount they actually received.
2. Can a trustee who acted dishonestly claim compensation under Section 33 of the 1882 trust law?
No, under Section 33 of the 1882 trust law, a trustee who has been guilty of fraud while committing the breach of trust is not entitled to any compensation or indemnity.
3. What special remedy does a trustee have if a beneficiary gains from a trust violation under Section 33 of the Indian Trusts Act, 1882?
Under Section 33 of the Indian Trusts Act, 1882, if a beneficiary gains from a trust violation, the trustee has a charge on that beneficiary's interest to recover the gained amount.
Test yourself
Q1.Under Section 33 of the Indian Trusts Act, 1882, what is the maximum amount a non-trustee who gains from a trust violation must pay to indemnify the trustee?
Q2.Under Section 33 of the Indian Trusts Act, 1882, what is the consequence if the trustee commits a breach of trust involving fraud?
Q3.Under Section 33 of the Indian Trusts Act, 1882, if a beneficiary is the one who gained an advantage from a breach of trust, how can the trustee recover that amount?
Q4.Imagine a scenario where a trustee incurs expenses under Section 32 and also seeks an indemnity from a gainer under Section 33 of the Indian Trusts Act, 1882. If the trustee acted fraudulently in both situations, which of the following is true?