Finance Act, 1917

Power of trustees, &c. to borrow and invest in war securities.

35.(1) It shall be lawful and shall be deemed always to have been lawful for a trustee to borrow for the purpose of subscribing to or investing in any securities which have been or may be issued in connection with any Government loan raised for the purpose of the present war, and a trustee shall not be liable for any loss resulting from any borrowing so authorised or from any subscription to or investment in such securities or the sale of any securities for the purpose of such subscription or investment, or from the exercise of any option to convert any securities into securities so issued, whether such borrowing, subscription, investment or sale, or the exercise of such option, was before or after the passing of this Act; and trustees and other persons acting in any fiduciary character are hereby expressly authorised to exercise without the consent of any other person, such powers of borrowing, subscription, investment, sale, or conversion, notwithstanding anything in any instrument creating the trust:

Provided that—

(a) In the case of transactions after the passing of this Act, a trustee shall before borrowing for the purpose aforesaid give notice of his intention so to do the persons for the time being beneficially entitled to the income of the trust fund and the amount borrowed shall not exceed the value for the time being of the trust fund;

(b) For the purpose of transactions after the passing of this Act the power to borrow for the purpose of investing in any such securities shall be deemed not to include a power to borrow for the purpose of purchasing any such securities at any time after the subscription list has been closed, or, in the case of any such securities which are issued on application from day to day, after the issue thereof has been discontinued.

(2) This section shall apply to any officer or department who holds funds on account of or for the benefit of any persons or class of persons as part of, or in consequence of, the duties of the officer or department, but shall not apply to any trustee under an implied or constructive trust, except a resulting trust arising on the determination or failure of an express trust.

(3) The foregoing provisions of this section, so far as they relate to the exercise of such powers as aforesaid before the passing of this Act, shall apply to local and other public authorities, notwithstanding any limitations on their powers, in like manner as they apply to trustees.

(4) It is hereby declared that the power conferred by subsection (6) of section one of the War Loan Act, 1916, on companies and bodies of persons and persons responsible for the direction and management of a company or body of persons to hold government securities purchased in pursuance of the powers conferred by that subsection is not limited to the continuance of the present war and a period of twelve months thereafter.

The powers conferred by the said subsection shall include, and shall be deemed as from the commencement of the war to have included, a power on the part of a company or body of persons and of persons responsible for the direction or management of the company or body to borrow, notwithstanding any such limitations as are mentioned in that subsection, for the purpose of investing in or purchasing Government securities in accordance with that subsection.