Surrogacy, trustee disputes and digital wealth: contentious trusts and estates insights

Interpretation, surrogacy and complex/blended families

Surrogacy is increasingly shaping family structures, but legal frameworks are still catching up.

The surrogate and the intended parents are often resident in different jurisdictions due to complications with surrogacy in the intended parents' home jurisdiction. For example, surrogacy might be illegal in the home jurisdiction, or the intended parents may have no rights in relation to the baby once it is born. Factors pushing parents abroad for surrogacy can give rise to complex international private law issues that need to be considered when surrogacy is used. For example, the domicile of the baby may be different from that of the intended parents and courts may find themselves having to consider multiple competing legal systems.

This will also have a bearing on how trusts and wills should be interpreted, as children born via surrogacy may be unintentionally excluded from trust definitions like 'issue' or 'descendants,' especially where outdated language is used.

There have been several cases this year where the court has had to consider commonplace terms, such as 'child', 'stepchild' or 'wife' in the modern context. For example, in Marcus v Marcus the court had to consider whether a non-biological child, raised as the settlor’s own, qualified as a 'child' under the trust. The decision to interpret the deed as including the non-biological child focused on the settlor’s intention and view that his non-biological son was, indeed, his son.

As these issues increasingly come before the courts, further guidance on interpreting the meaning of the terms will develop. There may well be increasing divergence between jurisdictions as to how those terms apply causing further issues when conflict of laws questions arise.

Trustee and executor removals

Disputes between fiduciaries and beneficiaries remain a frequent source of litigation. These disputes are often fuelled by intergenerational conflicts. As the baton passes from one generation to another, the new generation wants to bring in their own advisors and fiduciaries. Frequently the existing fiduciaries are seen as 'stooges' of the generation that went before. While many of these cases are resolved through an orderly, voluntary replacement, others require court intervention – typically when the new generation wants more rapid change than is being offered and hostilities escalate.

In cases this year, the court has reaffirmed that misconduct is not necessary for removal but hostility between beneficiaries and fiduciaries alone is not enough to justify removal. The key question is whether the trust or estate is being properly administered.

However, outcomes in litigation remain highly fact-specific. Two judgments from this year illustrate this point. In both the case of Earl of Yarmouth v Ragley Trust Company Ltd & Ors and Fernandez v Fernandez there were issues of hostility between beneficiaries and fiduciaries. However, the court reached different conclusions – refusing to remove the trustees in the Earl of Yarmouth claim but removing the executor and trustee in Fernandez.

We expect removal disputes to remain prevalent, particularly where relationships deteriorate and parties become entrenched.

Care of elderly relatives

With rising life expectancy and care costs, more families are caring for elderly relatives at home. This has led to a surge in posthumous disputes, especially where informal care arrangements were made without documentation.

Traditionally, such claims have often relied on proprietary estoppel. However, the case of Rogers v Wills introduced a novel approach. The claimant, a daughter who had cared for her mother for several years, successfully argued (unusually in a domestic context) that a contract existed between her and her mother for reasonable remuneration for the care provided. Alternatively, the court held that she could have succeeded on the basis of unjust enrichment, her services had been accepted without compensation.

This case signals a potential expansion of legal remedies available to family caregivers and underscores the importance of understanding the terms of care arrangements. Practitioners should advise clients to document care arrangements clearly, and executors must be alert to potential liabilities arising from unpaid care.

Digital assets and cryptocurrency

The legal treatment of digital assets continues to evolve following the judgment in late 2024 in D’Aloia v Persons Unknown & Ors in which the Court confirmed that cryptocurrencies (and other digital assets) can constitute property under English law. This aligns with the Law Commission’s recommendation to treat digital assets as a third category of personal property.

This recognition allows for proprietary remedies such as constructive trusts. Given the instances of fraud or scams surrounding cryptocurrency, these are useful remedies (provided the assets can be traced, which is often difficult).

Trustees and executors may find themselves asked to manage digital wallets, private keys, and custody arrangements and will need to consider carefully whether and how to fit these modern assets into existing trusts. In some cases, court applications may be needed to vary trust documents or authorise holding such high-risk investments.

As digital assets become more prevalent, we expect issues arising concerning their valuation, recovery and their place in a portfolio of trust assets. Their potential use in money laundering also introduces regulatory complexities for practitioners and fiduciaries.

Alternative dispute resolution (ADR) and court-ordered mediation

Under CPR r 3.1(2)(o), courts can compel parties to engage in ADR and courts are increasingly encouraging or mandating ADR in disputes. ADR has now also been mandated in a dispute involving probate, rectification, and negligence in the case of Ivey v Lythgoe.

Mediation is particularly effective in emotionally charged family disputes and complex fiduciary matters where a flexible outcome is needed beyond the realms of the relief a court can provide. There is also a growing trend toward earlier mediation – often before proceedings are issued – as clients seek to minimise both costs and emotional strain.

This reflects a broader shift toward efficiency and cost reduction. Mediation also offers parties a way to achieve certainty sooner than drawn-out proceedings. In an uncertain economic and political climate, this is attractive to parties.

This article was originally published in ThoughtLeaders4 HNW: A Year in Review. You can read the original version here.

Significant legal developments are anticipated in 2026, amid economic turbulence, the growing influence of AI and heightened public scrutiny. To help you prepare, our experts have produced key litigation-related insights across areas including arbitration, commercial litigation, contentious trusts & estates, family disputes, and more.

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This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, December 2025