Section 18: Protective or spendthrift trust

18. Protective or spendthrift trust (1) The terms of a trust may make the interest of a beneficiary subject to— (a) termination; (b) restriction on alienation of or dealing in that interest or any part of that interest; (c) diminution, suspension or termination, in the event of the beneficiary becoming insolvent or any of his property becoming liable to seizure or sequestration for the benefit of his creditors and such trust shall be known for the purposes of this Act as a protective or spendthrift trust. (2) Where any property is directed to be held on protective or spendthrift trust for the benefit of a beneficiary, the trustee shall hold that property— (a) in trust to pay the income to the beneficiary until the interest terminates in accordance with the terms of the trust or a determining event occurs; and (b) if a determining event occurs, and while the interest of the beneficiary continues, in trust to pay the income to any of the following as the trustee shall in his absolute discretion appoint— (i) the beneficiary and any spouse or child of the beneficiary; (ii) if there is no such spouse or child, the beneficiary and the persons who would be entitled to the estate of the beneficiary if he had at the time of the payment died intestate and domiciled in Mauritius. (3) For the purpose of subsection (2), “determining event” means the occurrence of any event, or any act or omission on the part of the beneficiary (other than the giving of consent to an advancement of trust property) which would result in the whole or part of the income of the beneficiary from the trust becoming payable to any person other than the beneficiary.