In our recent blog post on the introduction in the UK of Unexplained Wealth Orders (“UWOs“), which can be found here, we explained how the new investigative tool could affect you and your business. In short, UK authorities may require the owner of property to provide details of how the property was acquired, where the authority has reasonable grounds to suspect that the owner would not have sufficient lawfully obtained assets to finance the purchase of the property.
Although UWOs were only introduced on 31 January 2018, the UK National Crime Agency (“NCA“) has already acted so as to secure two UWOs in connection with assets with a total value of £22m belonging to an unnamed “politically exposed person” from central Asia. In an accompanying press release, Donald Toon, the Director for Economic Crime at the NCA, stated that UWOs “have the potential to significantly reduce the appeal of the UK as a destination for illicit income” and that they will “enable the UK to more effectively target the problem of money laundering through prime real estate in London and elsewhere“.
It is clear that the UK authorities are prepared to use UWOs in appropriate cases. As set out before, HM Government has not yet provided guidance on best practice in responding to a UWO. However, as the UK authorities have now secured UWOs, there may now be more information regarding the obligations of a respondent in replying to a UWO, either as a result of judicial decision or official guidance.
The UK Supreme Court has recently considered section 21(3) of the Limitation Act 1980 which provides or a six-year limitation period for actions by a beneficiary to recover trust property or in respect of any breach of trust (other than where the claim is based upon a fraud or fraudulent breach of trust, or where the claim is to recover trust property held by a trustee, for which there is no limitation period).
In Burnden Holdings (UK) Limited v Fielding and another  UKSC 14, the Supreme Court held that directors of companies are to be treated as being in possession of the property of their company. This means that in actions brought by companies against their directors in relation to the company’s property, the directors will be unable to rely on the six year limitation period where they are in possession of the trust property or its proceeds or have converted the trust property. The Court also commented, in passing, in relation to the (very common) position where trustees hold assets through companies. Continue reading
From 31 January 2018, UK authorities can use new and expansive investigative powers to require both individuals and corporate bodies to provide information as to how they acquired property. Known as Unexplained Wealth Orders (“UWOs”), these new obligations to disclose information can apply to property anywhere in the world and can be served on persons outside the UK. This briefing considers the legal framework behind UWOs, their interaction with other criminal and civil regimes, and the practical implications of UWOs on individuals, institutions and trustees.
The Companies Registry announced on 25 January 2018 that a new licensing regime for trust and company service providers (“TCSPs”) will come into force on 1 March 2018 under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615) (“AMLO”).
A new regime requiring companies to keep and maintain Significant Controllers Registers will also come into force on 1 March 2018, following the passing of the Companies (Amendment) Bill 2017 on 24 January 2018. Please see below for further details. Continue reading
In a recent decision, Sargeant v Sargeant  EWHC 8 (Ch), the English High Court considered the circumstances in which the English Court will grant permission for out-of-time applications for financial provision from a deceased’s estate under the Inheritance (Provision for Family and Dependants) Act 1975 (the “1975 Act“). In the present case, considered further below, the Court held that it would be unlikely to grant permission where an applicant has been aware of the circumstances necessitating an application but has declined to apply to the Court or otherwise seek a variation of arrangements for an extended period of time. Continue reading
We have previously reported on two provisions of the Trusts (Jersey) Law 1984, Articles 47H and 47G, which had been introduced following the UK Supreme Court’s judgment in Pitt v Holt  UKSC 26 (see our previous post here). That judgment overturned years of common law case law as to what had been thought to be the rule known as the rule in Re Hastings-Bass. In a recent judgment, In the matter of the L Trust  JRC 191, the Jersey Royal Court applied Articles 47H and 47G to set aside an exercise of a power by a trustee who had relied on incorrect tax advice when deciding to act. This decision demonstrates the Jersey court’s continued willingness to act to protect beneficiaries where trustees have relied on incorrect advice when making decisions. Continue reading
Having focused on the top 320 privately owned and wealthy groups (“Private Groups“) earlier this year, the Australian Tax Office (“ATO“) Tax Avoidance Taskforce team is about to take its next step and review the next 1,200 largest Private Groups. We set out further details below. Continue reading
Filed under Australia, Tax
The Supreme Court of England and Wales in its recent decision in Ivey v Genting Casinos  UKSC 67 (“Ivey“) took the opportunity to reassess the approach in criminal cases to determining whether a defendant has acted dishonestly. The Supreme Court held that the “Ghosh test”, which excused a defendant who did not know that ordinary and honest people would regard his behaviour as dishonest, should no longer be used. Instead the Court held that the test for dishonesty in criminal cases should be brought in line with the test already used in civil cases. We consider the decision further below.
Citywealth has just announced its finalists for its Magic Circle Awards 2018. We are thrilled to have been shortlisted twice. Herbert Smith Freehills has been shortlisted in International Law Firm of the Year – non UK and Richard Norridge has been shortlisted for Lawyer of the Year. There are many other trustees, advisers and firms who have been shortlisted across different categories.
If you wish to vote for any of the finalists, click here: https://www.citywealthmag.com/awards/magic-circle-awards/voting
The Queensland Supreme Court has held that an unsent text message written on a man’s mobile phone shortly before he died adequately captured his testamentary intention. In doing so, the Court dispensed with the normal execution requirements of a will, and allowed the text message to be admitted to probate: Re Nichol; Nichol v Nichol  QSC 220. The Court had been asked to determine two competing applications. The first was brought by the deceased’s widow, and supported by his son, asking that the rules of intestacy be applied. The second (and ultimately successful) application was brought by the deceased’s brother and nephew, who stood to gain under the terms of the unsent text message. This case highlights the powers given to courts in other parts of the world when considering the validity of documents that purport to set out testamentary intentions. This can be contrasted from the position of the courts in England and Wales, where the requirements for creating a will continue to be strict. We consider the decision further below.