In re Esteem Settlement v [2003] JLR 188 (13 June 2003)

In re Esteem Settlement v [2003] JLR 188 (13 June 2003)

A trust is only a sham if both settlor and trustee have a dishonest common intention that the true beneficial position is other than as stated in the trust deed; individual transactions may be shams even if the trust is valid.

Citation
[2003] JLR 188
Parties
Applicant: Esteem Settlement
Jurisdiction
Jersey
Judgment Date
13 June 2003
Procedural Posture
Trust Law / Judgment
Outcome
Trust not a sham; individual transactions may be shams.
Legal Topics
Sham Trusts, Intention of Donor, Trustee Intention, Beneficial Ownership
Trusts Sham Trusts Intention of Donor Trustee Intention Beneficial Ownership

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Parties

Esteem Settlement

Applicant

Procedural Posture

Trust Law / Judgment

Legal Issues

  1. 1 Whether the trust was a sham
  2. 2 Whether both settlor and trustee intended the beneficial position to differ from the trust deed
  3. 3 Whether individual transactions under a trust can be shams even if the trust itself is valid

Ratio Decidendi

A trust is only a sham if both settlor and trustee have a dishonest common intention that the true beneficial position is other than as stated in the trust deed; individual transactions may be shams even if the trust is valid.

Court Disposition

Trust not a sham; individual transactions may be shams.