Wills & Trusts Law Reports | Autumn 2023 #192In March 2007 Safe Investments Management UK (Safe), an unlimited company, transferred its shares in Gooch Investment (Gooch) to Equity Trust (BVI) Ltd, a trust company (2007 transfer), to be held on the terms of a settlement for the benefit of qualifying employees of Safe (First Staff Remuneration Trust). This transfer followed the transfer of interests in UK business assets (the estate) from the first and second appellants (Mr and Mrs Bhaur) to Safe and from Safe to its subsidiary Gooch. All these transfers took place as part of a tax scheme (scheme) promoted by Mr O’Toole, who operate...
Is a transaction one by which one party intended bounty on another with a false belief of the outcome of the transaction? Donna Matthews considers this question recently considered by the High Court of Justice of the Isle of Man The equitable jurisdiction is normally invoked where a disposition into a trust has unforeseen consequences …
Continue reading "Offshore trusts: Equitable mistakes and undoing the past"
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Wills & Trusts Law Reports | Autumn 2021 #184The claims concerned various tax avoidance schemes that had been established as ‘Remuneration Trusts’ for the claimants by Baxendale Walker LLP. The claimants were a successful businessman, Mr Levack, and various businesses of which he was a director and/or shareholder. In each case, one of the claimants was the ‘founder’ of the relevant trust. The defendants were various corporate entities having had a role in the trusts, together with HMRC.
The claimants maintained that the Remuneration Trusts had been entered into on the basis that they would offer various tax benefits, and wou...
Deeds of variation are often misunderstood in practice. Charlotte Watts and Joshua Lewison discuss a case that highlights common misapprehensions and possible solutions The judgment confirms that the personal representatives’ power derives from the consent of the beneficiaries and not from any inherent ability to depart from the dispositions of the estate made by the …
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Wills & Trusts Law Reports | Winter 2019 #177By his will the deceased, who died in November 2010, left his estate as to one half to his widow. She, by a deed of variation complying with s142 Inheritance Tax Act 1984 ( ‘IHTA ‘) ,varied the will in order to settle her half share on a discretionary trust of which the beneficiaries were herself, her children and remoter issue. The trust included a power of appointment in favour of the beneficiaries.
In 2012, the widow was in need of additional income. The trustees proposed making an appointment to the widow giving her an irrevocable life interest in the trust f...
Laura Abbott reviews recent case law to discern current attitudes towards rectifying a genuine mistake ‘If a trustee takes advice which later proves to be incorrect, Hastings-Bass is unlikely to relieve the trust of the financial consequences, but the broadened rule of mistake may (in some limited cases) serve to do so, depending on the …
Continue reading "Trustees and mistake: Where are we now?"
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In Freedman v Freedman, Clare Stanley QC analyses HMRC’s arguments against rescission of a voluntary disposition due to mistake ‘Practitioners need to bear in mind for the future that HMRC may challenge cases of unintended tax consequences concentrating on the gravity of the mistake.’ This article examines the recent decision of Mrs Justice Proudman in …
Continue reading "Mistake: Facing the consequences"
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Wills & Trusts Law Reports | June 2015 #150The trustees of a settlement dated 16 December 2003 made by the first claimant, Brian Kennedy, (the settlement) sought an order to correct a mistake made in the terms of an appointment dated 1 October 2008 (the October 2008 appointment).
Under the terms of the settlement, of which Mr Kennedy was originally the sole trustee, Mr Kennedy had a life interest in possession. The settlement contained a power of appointment exercisable by the trustees in favour of Mr Kennedy, his children and remoter issue. In default of appointment, the capital was held on trust for Mr Kennedy’s children...
Mark Studer reflects on the lessons from Wright v National Westminster Bank Plc [2014] ‘In the events which happened… Mrs Wright as spouse of the settlor would not be able to receive income from the trust fund at any time after its constitution while Mr Wright was still alive.’ Prior to the decision of the …
Continue reading "Equitable Mistake: After Pitt v Holt – the law in practice"
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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 …
Continue reading "Mistake: Fault lines"
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