A & Ors v D & Ors

A & Ors v D & Ors

The trustees formed a settled intention to create new 18 to 25 Trusts compliant with s.71D IHTA, vesting fixed interests in A's three children at age 25, and any deferral of entitlement was to be by power of advancement, not revocation. The Deeds of Appointment failed to implement this intention due to drafting errors, particularly the use of 'revocable' instead of 'irrevocable' and the definition of beneficiaries as a class rather than naming the three children. The high standard of proof for rectification was met.

Parties
Claimant: A; Claimant: B; Claimant: C; First Defendant: D; First Defendant: E; First Defendant: F; Second Defendant: G
Jurisdiction
England and Wales
Judgment Date
12 September 2017
Procedural Posture
Civil / Judgment
Outcome
claim for rectification granted
Legal Topics
Rectification of Trust Documents, Construction of Deeds, Inheritance Tax, Powers of Trustees
Trusts Equity Tax Rectification of Trust Documents Construction of Deeds Inheritance Tax Powers of Trustees

Case Brief

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Parties

A

Claimant

B

Claimant

C

Claimant

D

First Defendant

E

First Defendant

F

First Defendant

G

Second Defendant

Procedural Posture

Civil / Judgment

Legal Issues

  1. 1 Whether the Deeds of Appointment should be rectified to reflect the trustees' true intentions
  2. 2 Whether the Deeds of Appointment comply with s.71D of the Inheritance Tax Act 1984
  3. 3 Whether the use of 'revocable' instead of 'irrevocable' invalidates the creation of 18 to 25 Trusts

Ratio Decidendi

The trustees formed a settled intention to create new 18 to 25 Trusts compliant with s.71D IHTA, vesting fixed interests in A's three children at age 25, and any deferral of entitlement was to be by power of advancement, not revocation. The Deeds of Appointment failed to implement this intention due to drafting errors, particularly the use of 'revocable' instead of 'irrevocable' and the definition of beneficiaries as a class rather than naming the three children. The high standard of proof for rectification was met.

Court Disposition

claim for rectification granted

Orders

  • Order for rectification of the Deeds of Appointment to reflect the trustees' true intentions as set out in the judgment