Trustees: Relief from flawed decisions

The Privy Council has clarified the operation of the rule in Hastings-Bass and how the beneficial ownership of gratuitously transferred assets should be determined. Alan Boyle QC, Richard Wilson QC and Zahler Bryan discuss ‘On the facts of this case MAR’s intention was sufficient, because at the material time MAR was also the governing mind …
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Trustees: Setting the scope of relief

Mathew Newman and Abby Lund review Guernsey‘s first written judgment on the rule in Hastings-Bass ‘The court ultimately held that any breach of duty by a trustee was capable of being treated as enabling the court to intervene and exercise the Hastings-Bass jurisdiction to set aside the relevant act or transaction, if the court was …
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Trustees: Clear blue water

Gillian Christian highlights a landmark Isle of Man judgment that casts doubt on Pitt v Holt [2013] ‘The principle behind Hastings-Bass refers to the jurisdiction of the court to intervene and set aside a transaction entered into by a trustee (and all fiduciaries) on the grounds of “inadequate deliberation” in the exercise of a discretion.’In …
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Freedman v Freedman & ors [2015] EWHC 1457 (Ch)

Wills & Trusts Law Reports | September 2015 #152

In 2001 the claimant purchased a house (St Leonard’s Close) with the assistance of a loan from her father. In 2004-5 the claimant’s father agreed to forego the loan. In 2010 the claimant moved out of St Leonard’s Close and into rented accommodation. The claimant wished to buy a different house (Gibbs Green) but she had difficulty selling St Leonard’s Close. Her father therefore agreed to lend her sufficient funds to cover the purchase price of £525,000 and the acquisition costs of £5,000 in respect of Gibbs Green. The claimant’s father made clear, and the cl...

Mistake: Fault lines

Kennedy v Kennedy [2015] expands the horizons of the doctrine of mistake. Steven Kempster and Sarah Aughwane explain ‘If a trustee makes a causative mistake of sufficient gravity, the transaction is voidable even if the mistake is as to the tax consequences.’ Two years ago the Supreme Court heard the joined appeals in Pitt v …
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Trusts: Trust comes first

Roadchef is a straightforward application of Hastings Bass to an EBT, finds Marilyn McKeever ‘This sorry tale is a reminder to the trustees of employee benefit trusts, pension schemes and, indeed, family trusts that they have onerous duties which they must exercise in the interests of their beneficiaries.’ In the case of Roadchef (Employee Benefit …
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Trustees: Self-dealing – rigours and risks

Brudenell-Bruce offers salutary lessons about the self-dealing rule, as Simon Atkinson explains ‘ Brudenell-Bruce provides a restatement of the law relating to estoppel by deed and applies principles of construction to deeds and consent orders.’ For chancery practitioners Brudenell-Bruce (Earl of Cardigan) v Moore and Cotton [2012] provides valuable guidance in a number of areas. …
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Futter & anr v HMRC; Pitt & anr v HMRC [2013] UKSC 26

Wills & Trusts Law Reports | July/August 2013 #131

The first appeal concerned two settlements, made with non-resident trustees, by Mr Futter. Considerable ‘stockpiled’ gains were rolled up while the trusts were non-resident and, in exercise of the powers conferred by the trusts, new resident trustees were appointed and capital was distributed to Mr Futter and his children in the mistaken belief that the ‘stockpiled’ gains, which would be attributed to them, would be absorbed by allowable losses that had been realised, so that no liability to capital gains tax would arise. In advising as to the effect of s87

Trustees: Back on the right course?

Marilyn McKeever discusses the implications of the Supreme Court decision in Futter v Futter and Pitt v Holt ‘The Hastings-Bass jurisdiction applies where the trustee or other person has failed to take into account any relevant considerations or took into account irrelevant considerations and would not have taken the action they did but for that …
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Re the Ta-Ming Wang Trust Cause no. FSD 0089 of 2010

Wills & Trusts Law Reports | January/February 2013 #126

The first plaintiff (TMW) and members of his family are the beneficiaries under the Ta-Ming Wang Trust (the trust). The trust was intended to take advantage of a well-established tax-saving structure under which a foreign national such as TMW immigrating into Canada could obtain a five-year Canadian tax holiday on foreign source income earned by a non-resident company, owned by a non-resident trustee; ie on income by way of dividends paid by the company to the trust during the five-year tax holiday. It was established by a settlement dated 2 May 1996 made between TMW’s mother as se...