BVI Court of Appeal Comment on Trustees’ Duty to Account and Evidential Presumptions in Trusts

The BVI Court of Appeal has recently allowed an appeal concerning a trustee's failure to account and breach of trust.[1] The breach of trust arose as a result of the trustee making an appointment of the trust assets without considering all relevant circumstances. In overturning the decision, the Court noted that if a settlor transfers further property to the trustee, a presumption arises that such property is to be held on trust under the same terms as the original trust. Such presumption can be rebutted, but the burden of proof rests with the trustee to do so.

The case has interest for private wealth matters regardless of jurisdiction, given the popularity of the BVI when structuring assets.

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Filed under Offshore, Trust disputes

Private Groups attracting ATO attention

The ATO has once again shown Private Groups that it is committed to greater transparency – however only this time, it is the ATO that is being transparent. Late last week, the ATO released a list of behaviours, characteristics and tax issues that will attract its attention in relation to Private Groups. The release can be found here.

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Filed under Australia, Tax

Court of Appeal considers dispute over mother’s mental capacity

The Court of Appeal of Hong Kong has recently upheld a decision appointing a son to be the Committee to take care of his incapacitated mother's affairs[1]. This was despite protest from the son's sibling, who claimed the son was an inappropriate person to be the Committee. The sibling also contested that their mother did not lack capacity and thus a subsequent Will in the sibling's favour was valid.

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Filed under Hong Kong and Singapore, Private wealth and trusts

Court orders solicitor to complete estate administration or face jail

The County Court at Cardiff has recently ordered a solicitor to comply with the Legal Ombudsman's direction to complete the administration of an estate.[1]  Failure to do so would result in imprisonment for 14 days. The case re-enforces the importance of complying with the Legal Ombudsman's directions in relation to estate administration and illustrates how the Court is willing to enforce such directions.

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Filed under Private wealth and trusts

Family dispute over the setting-up of a trust rejected because plaintiff consented to the trust at the time of establishment

In a recent case, the Singapore High Court has held that a plaintiff's agreement to the setting-up of a trust to protect a family's wealth (including the assets of a deceased family member) was a valid defence for a defendant facing claims of breach of duty as executrix and breach of trust.[1] The case illustrates that the setting up of a trust structure designed to protect family wealth can defeat a claim for subsequent allegations of breach of trust.

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Filed under Estates disputes, Hong Kong and Singapore, Private wealth and trusts, Trust disputes

Jersey Court gives directions to trust company under the Foundations (Jersey) Law 2009

The Royal Court of Jersey has recently heard the second application under the Foundations (Jersey) Law 2009 (the “Foundations Law”). The Application was from a trust company in its capacity as the sole council member of a set of foundations (the "Foundations"). The trust company sought directions as to whether it could amend certain provisions of the Foundations' constitutional documents.  If the Court found that the trust company had the requisite powers, the trust company sought the Court's approval in making the amendments.

This judgment will be of interest to Asian high net worth families and their advisors because Jersey is a popular offshore jurisdiction, and more and more Asian high net worth families are considering using foundations in their structures.

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Filed under Estates disputes, Offshore, Private wealth and trusts

Solicitor fined by SRA for drawing deceased client’s funds

A former partner of a Leeds law firm agreed a fine with the English Solicitors Regulation Authority (the "SRA") after he used expired Powers of Attorney to withdraw funds from a client's bank account, in order to fund the purchase of a property for his daughter.

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Filed under Fiduciaries, London

Court finds father cannot alter his will to stop son inheriting the family farm

The English High Court has recently found that a father could not change his Will so as to prevent his son receiving sole ownership of a family farm. [1] The farm had been promised to the son over the course of many years. It was held that these promises created an equitable interest in the farm and the father was now estopped from denying the son's entitlement. The case serves as an example of when the Court will be willing to find an equitable interest in assets.

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Filed under Estates disputes

Hong Kong Court rejects case that shares were held on trust, finding that evidence adduced was inconsistent

The Hong Kong High Court has recently held that Eric Hotung had not imposed a trust in his favour when he gave HK$2,000,000 to Ho Yuen Ki in 1961 for the purchase of shares in a Macau gambling business.1 Whilst the Court declined to characterise the transfer of the funds as a gift or loan or otherwise, the Court held that the claimant's evidence at trial was so inconsistent that on the balance of probabilities it could not conclude a trust had been created.

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Filed under Hong Kong and Singapore, Trust disputes

Leading Herbert Smith Freehills lawyers to speak at major trusts conference in London

Members of Herbert Smith Freehills' Contentious Trusts team (Tom Leech QC, Richard Norridge and Gareth Keillor) will be speaking at a conference on Trustee Protection on 20 October 2016, along with a number of other leading practitioners in this area.

Herbert Smith Freehills is also the lead sponsor of the conference and a 30% discount is available. For more information, and to book and claim the discount, please click here and quote code FKW53395HSF when booking.

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Filed under Private wealth and trusts, Trust disputes