58Infant beneficiary, application of income until 18

##### 58. Infant beneficiary, application of income until 18 (1) Where any property is held by a trustee in trust for any person for any interest whatsoever, whether vested or contingent, then, subject to any prior interests or charges affecting that property — (a) during the infancy of that person, if his interest so long continues, the trustee may, at his sole discretion, pay to his parent or guardian (if any) or otherwise apply for or towards his maintenance, education (including past maintenance or education) or his advancement or benefit, the whole or such part, if any, of the income of that property as may, in all the circumstances, be reasonable, whether or not there is — (i) any other fund applicable to the same purpose; or (ii) any person bound by law to provide for his maintenance, education, advancement or benefit; and (b) if the person on attaining the age of 18 years has not a vested interest in that income, the trustee shall thenceforth pay the income of that property and of any accretion thereto, under subsection (2), to him until he either attains a vested interest therein or dies, or until failure of his interest; but, in deciding whether the whole or any part of the income of the property is during a minority to be paid or applied for the purposes in this subsection mentioned, the trustee shall have regard to the age of the infant and his requirements and, generally, to the circumstances of the case, and in particular to what other income (if any) is applicable for the same purposes; and where the trustee has notice that the income of more than one fund is applicable for those purposes, then, so far as practicable, unless the entire income of the funds is paid or applied for those purposes or the Court otherwise directs, a proportionate part only of the income of each fund shall be so paid or applied. (2) During the infancy of any such person as is mentioned in subsection (1), if his interest so long continues, the trustee shall accumulate all the residue of that income in the way of compound interest by investing it and the resulting income thereof from time to time in investments in which trust funds may be invested under this Act, and shall hold those accumulations — (a) if the person — (i) attains the age of 18 years, or marries under that age, and his interest in the income during his infancy or until his marriage is a vested interest; or (ii) on attaining the age of 18 years or on marriage under that age becomes entitled to the property from which the income arose in fee simple, absolute or determinable, or absolutely, or for an entailed interest, in trust for that person absolutely, but without prejudice to any provisions with respect thereto contained in any settlement by him made under any statutory power during his infancy, and so that the receipt of that person after marriage, and though still an infant, shall be a good discharge; and (b) in any other case, notwithstanding that the person had a vested interest in the income, as an accretion to the capital of the property from which the accumulations arose and as one fund with that capital for all purposes; but the trustee may, at any time during the infancy of that person if his interest so long continues, apply those accumulations, or any part thereof, as if they were income arising in the then current year. (3) This section applies in the case of a contingent interest, only if the limitation or trust carries the intermediate income of the property held in trust, but it applies to a future or contingent legacy by the parent of, or a person standing *in loco parentis* to, the legatee, if and for such period as, under the general law, the legacy carries interest for the maintenance of the legatee, and in the latter case the rate of interest shall (if the income available is sufficient and subject to any rules of Court to the contrary) be 5% per annum; and where in the case of a contingent interest the limitation or trust would, but for the operation of a protective trust (whether created or statutory) carry the intermediate income of the property, that limitation or trust shall for the purposes of this subsection be deemed, notwithstanding the protective trust, to carry the intermediate income. (4) This section applies to a vested annuity in like manner as if the annuity were the income of property held by a trustee in trust to pay the income thereof to the annuitant for the same period for which the annuity is payable, save that in any case accumulations made during the infancy of the annuitant shall be held in trust for the annuitant or his personal representative absolutely. [Section 58 amended: No. 113 of 1965 s. 8; No. 46 of 1972 s. 6(2); No. 1 of 1997 s. 13.]