Abstract:
This article discusses and compares the laws of bond trust in four common law jurisdictions - the UK, the US, Australia and New Zealand. It points out that, while there are certain differences between the English bond trust law and the US bond trust law, the two legal regimes share significant similarities. In particular, English and US bond trustees only have a limited duty to monitor the performance of the issuer. In contrast, both Australian and New Zealand laws require bond trustees to exercise reasonable diligence to ascertain whether any breach of the bond trust deed has occurred and whether the issuer's assets are sufficient to discharge its obligations under the bonds. This article also identifies a drafting error in s 283F(1) of the Corporations Act (Cth).