JTC Employer Solutions Trustee Limited & Ors v William Garnett & Anor

JTC Employer Solutions Trustee Limited & Ors v William Garnett & Anor

The deeds of appointment under the HFBT and EFRBS were executed under an operative and sufficiently grave mistake as to their inheritance tax consequences, specifically the loss of s.86 IHTA 1984 protection. The mistake was basic to the transactions, not the result of deliberate risk-taking, and it would be unconscionable to leave the mistake uncorrected given the significant tax liabilities. Public policy and laches did not bar relief in the circumstances, and a representation order was appropriate.

Parties
Claimant: JTC Employer Solutions Trustee Limited (as Trustee of the Henderson Family Benefit Trust and of the Henderson Group PLC Employer Financed Retirement Scheme); Claimant: Janus Henderson Administration Limited; Claimant: Janus Henderson UK (Holdings) Limited; Claimant: Janus Henderson Investors UK Limited; Defendant: Mr William Garnett; Defendant: Mr Manraj Sekhon
Jurisdiction
England and Wales
Judgment Date
12 September 2024
Procedural Posture
Claim for Rescission of Trust Appointments / Judgment After Contested Hearing
Outcome
Claim allowed; deeds of appointment set aside
Legal Topics
Rescission of Voluntary Dispositions, Mistake in Trust Law, Inheritance Tax Act 1984 S.86, Employee Benefit Trusts, Public Policy in Tax Avoidance
Equity and Trusts Tax Law Rescission of Voluntary Dispositions Mistake in Trust Law Inheritance Tax Act 1984 S.86 Employee Benefit Trusts Public Policy in Tax Avoidance

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Parties

JTC Employer Solutions Trustee Limited (as Trustee of the Henderson Family Benefit Trust and of the Henderson Group PLC Employer Financed Retirement Scheme)

Claimant

Janus Henderson Administration Limited

Claimant

Janus Henderson UK (Holdings) Limited

Claimant

Janus Henderson Investors UK Limited

Claimant

Mr William Garnett

Defendant

Mr Manraj Sekhon

Defendant

Procedural Posture

Claim for Rescission of Trust Appointments / Judgment After Contested Hearing

Legal Issues

  1. 1 Whether the deeds of appointment under the HFBT and EFRBS should be rescinded for mistake as to their inheritance tax consequences
  2. 2 Whether the mistake was sufficiently grave and operative to justify equitable relief
  3. 3 Whether public policy or delay/laches should bar relief

Ratio Decidendi

The deeds of appointment under the HFBT and EFRBS were executed under an operative and sufficiently grave mistake as to their inheritance tax consequences, specifically the loss of s.86 IHTA 1984 protection. The mistake was basic to the transactions, not the result of deliberate risk-taking, and it would be unconscionable to leave the mistake uncorrected given the significant tax liabilities. Public policy and laches did not bar relief in the circumstances, and a representation order was appropriate.

Court Disposition

Claim allowed; deeds of appointment set aside

Orders

  • Deeds of appointment under the HFBT and EFRBS set aside for mistake
  • First defendant appointed as representative beneficiary for HFBT appointments