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Trusts and Estates Law and Tax Journal: June 2015

Election time provides Geoffrey Shindler a chance to reflect on two intertwined issues for practitioners: the digital age and the growth of HMRC’s powers

If there are two things that will mark out the current age for trust and estate practitioners, they are the development and growth of the internet and digital progress (more about that phrase later), and the dramatic increase of HMRC’s powers.

Paul Davidoff considers the EU Succession Regulation and whether it has fulfilled its purpose

When Christopher Columbus first crossed the Atlantic, he thought he had landed in Japan, before sailing on to China. With the benefit of hindsight and many subsequent journeys, we now believe that he had probably arrived in the Bahamas, before sailing on to Cuba and Hispaniola. It was, however, not immediately obvious to Columbus that he had not reached his intended oriental destination.

The Woodland Trust v Loring [2014] demonstrates the importance of determining the testator’s exact intentions. Marilyn McKeever explains

The Court of Appeal decision in The Woodland Trust v Loring [2014] is another salutary reminder of the need for will draftsmen to own a fully functioning crystal ball.

Sarah Lee sums up the main provisions of the Care Act 2014 for private client practitioners

On 1 April 2015, most of part 1 of the Care Act 2014 (the Act) came into force. This follows years of consultation and review going back to the government’s ‘Vision for Adult Social Care’ launched in November 2010 and the Law Commission’s report on adult social care published on 11 May 2011.

Appleby

Andrew Willins and Sebastian Said examine a case which has lessons on liability and its proper limitation for trustees

It is comparatively rare to encounter judgments from the major offshore jurisdictions in which a trustee is ordered to pay multi-million dollar compensation in respect of losses caused to the trust fund by negligent performance of its duties. More often than not, trust deeds and deeds of retirement contain well-drafted limitation clauses and indemnities which provide a high degree of protection to the trustee, even in circumstances where they have acted negligently. Of course, this is not true of the deeds of all offshore trusts, as is well illustrated by a judgment handed down in January 2014 in the BVI Commercial Court by Judge Bannister in the matter of Appleby Corporate Services (BVI) Ltd (as a trustee of The Clef Trust) v Citco Trustees (BVI) Ltd [2014].

Mark Studer reflects on the lessons from Wright v National Westminster Bank Plc [2014]

Prior to the decision of the Supreme Court in Pitt v Holt [2013], the English law of equitable mistake in relation to voluntary dispositions left some room for contention, especially where an intending donor or settlor had entered into such a transaction under a misapprehension as to its fiscal consequences. In Gibbon v Mitchell [1990] Millett J had held that, wherever there was a voluntary transaction by which one party intended to confer a bounty on another, the court would set aside the operative deed if it was satisfied that the disponor did not intend the transaction to have the effect which it did, provided that the mistake in question (whether of law or of fact) was a mistake as to the effect of the transaction itself, and not merely as to its consequences or the advantages to be gained by entering into it. This distinction between ‘effects’ and ‘consequences’ was not easily understood, but it was generally interpreted to mean that a mistake by the disponor as to the treatment of the transaction for tax purposes would be outside the scope of the relief.

Taylor v Bell indicates that the court has unfettered discretion to vary periodic payments under the Inheritance Act 1975. Richard Selwyn Sharpe discusses

Taylor v Bell [2015] is the first reported decision on an application to vary a consent order for periodical payments under s6 of the Inheritance (Provision for Family and Dependants) Act 1975. The application was contested by the executors for the estate, who succeeded in a damage limitation exercise reducing the applicants’ claim for increased periodical payments from over £90,000 to £21,500.