Last updateTue, 24 Feb 2015 5pm

Trusts and Estates Law and Tax Journal: September 2015

Illot v Mitson raises profound moral issues. Geoffrey Shindler explains

Law and morality. This is a subject to which we do not devote enough time. Those of us fortunate at university to be able to study something called ‘jurisprudence’ found the concept interesting but overtaken by a lot of other legal subjects which seemed to have more priority and relevance and were easier to understand. In our life in practice it is a matter of dealing with the next file rather than contemplating the greater scheme of things.

Araba Taylor examines Re Butcher [2015], a case that puts the principles of Gill v Woodall into practice

Before the CA decision in Gill v Woodall [2011], the courts approached the task of establishing ‘knowledge and approval’ of a will in two stages, applying Barry v Butlin [1838]. Firstly, affirmative proof of knowledge and approval was required wherever circumstances existed to ‘excite the suspicion of the court’. That suspicion then had to be ‘removed’ by those propounding the will, so that the court could be satisfied on the balance of probabilities that the testator did know and approve the contents of the will. What was required of the propounders would depend on the facts of any given case, as the degree of suspicion might be slight, or ‘so grave it [could] hardly be removed’: see Wintle v Nye [1959] per Viscount Simonds.


James Ward gives an update for practitioners on the management of digital assets

Digital assets are all around us. It is almost impossible to exist in today’s world without owning, relying upon, referring to or communicating through some form of digital asset. The internet is increasingly becoming the main storage of our financial and personal lives and there seems to be no stopping this increase in the future.


Keith Robinson discusses a case concerning the disclosure of information to beneficiaries and the role of the protector

It is now more than ten years since the seminal decision of the Privy Council in Schmidt v Rosewood Trust Ltd [2003] established that a beneficiary’s right to seek the disclosure of trust documents was ‘… one aspect of the court’s inherent jurisdiction to supervise, and if necessary to intervene in, the administration of trusts’ (per Lord Walker at para 51). Since the decision in Schmidt, there has been very little case law that examines the working out of this general principle in particular or in difficult circumstances. One such case was Breakspear v Ackland [2008] that concerned the disclosure of a settlor’s letter of wishes. We now have some further learning as a result of a recent decision of the Chief Justice of Bermuda in In the Matter of An Application for Information About A Trust [2014]. This article will look in detail at this decision, together with the decision of the Bermuda Court of Appeal which upheld the first instance ruling.

Forsters LLP

Zahra Kanani looks at the lessons to be learned from NHS Foundation Trust v Mrs X [2014], which marks a shift in the court’s attitude to ‘the right to life’

The issues that were before the Court of Protection in the case of A NHS Foundation Trust v Ms X [2014] illustrate the difficulties involved in applying legal principles to issues involving care and life-sustaining treatment. Cobb J’s sensitive, empathetic and humane judgment is a sign that the courts are beginning to resist the application of Article 2 of the European Convention on Human Rights (ECHR) (the right to life) and the obligation to preserve life at all costs and moving towards respecting the autonomy of the individuals concerned.

Re Portman Estate [2015] provides useful pointers on modernising a trust. Georgia Bedworth reports

Most settlements are designed to be long-term structures with a long duration. Trusts which were made many years ago are still in operation. It is convenient for administrative reasons, as well as for tax considerations, for property to remain in settlement as long as possible, particularly where large estates are concerned. Given the current trend to extend trust periods under the Variation of Trusts Act 1958 (VTA 1958), taking advantage of the 125-year perpetuity period under the Perpetuities and Accumulations Act 2009, property is likely to continue to be settled for a long period. Inevitably, over the course of a lengthy trust period, practices as to the administration of trusts will change. For example, over the years investment powers of trustees have gradually become more flexible, as has the willingness to allow the trustees to trade, to give trustees increased flexibility in the administration of the trust assets. As trustees are limited to powers given to them by the trust instrument supplemented by those implied by law, trustee powers can become outmoded, even if the settlement was drafted in accordance with best practice at the date of its creation. This can leave trustees unable to adapt to changing circumstances and therefore unable to obtain the best return on the settled funds for the benefit of the beneficiaries. As a settlement gets older, those administrative difficulties are likely only to increase. The need to adapt to modern circumstances is what prompted the application in the recent case of Re Portman Estate [2015].

Oliver Auld and Tamasin Perkins consider Birdseye v Roythorne & Co [2015], which concerns the waiver of privilege by executors

The decision of the High Court in Birdseye v Roythorne & Co [2015] (Birdseye) has established that one of two or more executors is capable of acting unilaterally to waive privilege in legal advice obtained under a joint retainer on behalf of the estate, applying the general rule that executors are capable of acting unilaterally on behalf of the estate and binding their co-executors to their actions. The general rule contrasts with the law in respect of trustees, who must act unanimously if their actions are to be binding on the trust. In part due to the different legal origins in the two roles, executors are not governed by the same rules and as a result may therefore find themselves bound by their co-executors’ actions (and their consequences), whether or not they were aware of or consented to them.