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Are married women barred from being trustees in Bangladesh?

Anita Ghazi Rahman | July 07, 2023 00:00:00

The concept of Trust is assumed to have existed since Roman times; decidedly since the 1400s in English law. It has been rigorously debated for four years in parliament in India before being adopted as law in 1882 and eventually inherited by us. The legal concept of trust has become one of the most important innovations in property law, dealing both in immovable property and moveable property (including money) and has even been touted to be 'the greatest and most distinctive achievement performed by Englishmen in the field of Jurisprudence.' The Trusts Act of 1882 is an oft-used law in Bangladesh and, although seemingly over 140 years old, the law actually saw an amendment in Bangladesh as recently as 2000. The Act is intended to regulate private trusts and trustees of private trusts while excluding from its realm and ambit waqfs, religious and charitable trusts. The Trusts Act specifies what a trust is and who can legally be its trustees.

To put it in basic terms, a trust is a legal relationship in which a person is entrusted with the legal title to property and is obligated to hold and utilise it for the benefit of another. The party who entrusts the property is known as the "Settlor" or "Author" of the trust, the party to whom the property is entrusted is known as the "Trustee", the party who receives the benefit of the trust property and for whose benefit the trust is created is known as the "Beneficiary", and finally, the entrusted property itself is known as the "Corpus" or "Trust property" (this could be either landed property or money). Since the prohibition of benami transactions of immovable property by the Land Reforms Ordinance, 1984, the usage of trusts for the better part is (as seen by the author) in the establishment of educational institutions, employee funds and securities instruments in Bangladesh - each of which involve, more often than not, substantial fund Corpus, particularly in the form of capital funds. The administration of the Corpus vested on Trustees, is, therefore, an entrustment of confidence on such persons.

Under section 60 of the Trusts Act, the beneficiaries of a trust have the right to expect that the trust property shall be properly protected and held and administered by "proper" persons, and by a "proper" number of such persons. The word "proper" shows up four times in the section, including the explanation. Explanation I to section 60 sets out as to who are not proper persons within the meaning of this section: and this category includes a person domiciled abroad; an alien enemy; a person having an interest inconsistent with that of the beneficiary; a person in insolvent circumstances and unless the personal law of the beneficiary allows otherwise, a married woman and a minor. And while someone living abroad, a person having interests different from the beneficiary (thereby creating a conflict of interest), a minor (who is incompetent to contract anyway) and other such categories are understandable, the inclusion of married women in the category of persons not "proper" to be trustees, irrespective of personal laws is plainly redundant and out-of-sync with current times globally and particularly within Bangladesh where we often quote the empowerment of women in every sphere, from politics to governance to sports and profession.

The thrust of Section 60 of the Act is to emphasise that "the trust property shall be properly protected" and held and administered through proper persons. It is offensive to even think in this day and age that married women do not fall within this group. Of course, the non-eligibility of women in this provision does not come into play if "the personal law of the beneficiary allows otherwise". However, say in the very common scenario of multiple beneficiaries, for example in running an educational institution or a securities bond created through a modus of a trust deed, how does one determine the "personal law" of the beneficiaries… or should they even have to make such a determination? The premise is entirely ridiculous in the present day and yet such inequitable, undignified and discriminatory wording in a statute went undetected during the 2000-amendment to the law despite Constitutional protections and international legal obligations.

The amendment to the Bangladesh Trusts Act in 2000 broadened the scope of investment to be made through the corpus of the trust, allowing investment of unused money of the trust in securities listed in the stock exchanges. The change appears to be a focused amendment of the law which overlooked the opportunity of a holistic review of an extremely important statute, which may be long overdue. It is hoped that even a cursory review of the law will identify this extremely discriminatory provision, which is patently contrary to the concerted efforts on gender parity that has been achieved by Bangladesh in the last decades.

Looking back at the legislative history of this particular law, it is worth noting that an explanation was added in the legacy Act by the Indian Law Commission while the statute was in the Bill stage in India, stating : "In Hindu and Mohammedan families, a minor son often succeeds to property, burdened with a trust for dependent relations of his father, and a married woman is sometimes made by her father trustee for herself and her son or daughter". The disqualification of married women is throwback to a time when women in England and in India were unable to hold property due to certain archaic laws. In an amendment to the Trusts Act in India in 2016 the words "unless the personal law of the beneficiary allows otherwise, a married woman and" in Explanation I was omitted by amendment in the Indian Trusts Act as being 'out of tune with modern social notions'. In Bangladesh, we inherited the legacy statute from India but not the amendment which came much later. It is up to our legislature now to be proactive in rectifying the redundant text in our Trusts Act in order not to perpetuate de jure inequality and discrimination against women, particularly when as a country we are seen as a global role model in women's empowerment.

The position of a trustee is a fiduciary obligation, and the test in choosing trustees should be that of prudence, caution, integrity and soundness, not gender. Particularly so, when equality of opportunity and participation of women in all spheres of national life is one of the fundamental principles of State policy per our Constitution and Article 8(2) of the Constitution requires that these principles "shall be fundamental to the governance of Bangladesh, shall be applied by the State in making of the laws… and shall form the basis of the work of the State and of its citizens".

In conclusion, the Trusts Act in section 60 lays down the general right of the beneficiary to see that the property in trust is secure in the hands of the trustee. The author expects there is hardly a reader who will argue today that property is more secure in the hands of men and less so in the hands of women. The bar attached in the discussed law to married women being trustees in Bangladesh is not only unjustified, but honestly sexist. In fact (lacking a central searchable database), it would be safe to say that there are numerous trusts in Bangladesh, including leading educational institutions and securities trusts dealing in large sums of money, which already have trustees who are married women. That is the accepted norm in our country. The author can only surmise that keeping the provision has been an oversight…yet, notwithstanding, the amendment to the particular wording in Explanation I of section 60 of the Bangladesh Trusts Act is long overdue and merits immediate attention given its far-reaching effects on important spheres of the economy, our nation's goals of development and in leaving no one behind.

Anita Ghazi Rahman is an Advocate of the Supreme Court. She is the Managing Partner of The Legal Circle. [email protected].

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