In the matter of A (Settlement) [2012] JRC 005 (05 January 2012)

In the matter of A (Settlement) [2012] JRC 005 (05 January 2012)

The Court accepted the surrender of RBC's discretion due to clear conflict between duties as trustee of three settlements and directed implementation of the settlement agreement reached by all adult beneficiaries, but refused to direct RBC to enter into a tax avoidance loan scheme against its advice.

Citation
[2012] JRC 005
Parties
Representor/trustee: RBC; Respondents: Adult beneficiaries of D, B, and C Settlements; Representative of Grandchildren and Remoter Issue of D Settlement: Mrs Davies
Jurisdiction
Jersey
Judgment Date
05 January 2012
Procedural Posture
Trust Directions Application / Final Directions and Implementation of Settlement Agreement
Outcome
Settlement agreement between adult beneficiaries implemented; trustee's discretion surrendered and accepted; direction for tax avoidance loan refused.
Legal Topics
Trustee Discretion, Conflict of Interest, Tax Avoidance, Beneficiary Settlement, Surrender of Discretion
Trusts Taxation Equity Trustee Discretion Conflict of Interest Tax Avoidance Beneficiary Settlement Surrender of Discretion

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Parties

RBC

Representor/trustee

Adult beneficiaries of D, B, and C Settlements

Respondents

Mrs Davies

Representative of Grandchildren and Remoter Issue of D Settlement

Procedural Posture

Trust Directions Application / Final Directions and Implementation of Settlement Agreement

Legal Issues

  1. 1 Whether the trustee (RBC) should surrender its discretion to the Court
  2. 2 Whether the Court should direct RBC to implement a tax avoidance scheme
  3. 3 Whether the settlement agreement between beneficiaries should be implemented

Ratio Decidendi

The Court accepted the surrender of RBC's discretion due to clear conflict between duties as trustee of three settlements and directed implementation of the settlement agreement reached by all adult beneficiaries, but refused to direct RBC to enter into a tax avoidance loan scheme against its advice.

Court Disposition

Settlement agreement between adult beneficiaries implemented; trustee's discretion surrendered and accepted; direction for tax avoidance loan refused.

Orders

  • Directions given for implementation of settlement agreement separating interests of D, B, and C Settlements.
  • No direction given to RBC to procure loan from EE to AA for tax avoidance purposes.