Hawksford Trustees Jersey Ltd v P [2021] JCA 201 (06 August 2021)

Hawksford Trustees Jersey Ltd v P [2021] JCA 201 (06 August 2021)

The Court's powers under Article 47G(2) of the Trusts (Jersey) Law 2004 do not permit the substitution of a different transaction (gift) for the original sale by partial avoidance; the exercise of power must be avoided wholly or partially, but cannot be transformed into a donation or have its price rewritten solely to achieve a tax advantage.

Citation
[2021] JCA 201
Parties
Applicant: Hawksford Trustees Jersey Limited; Respondent: P; Third Party: C
Jurisdiction
Jersey
Judgment Date
06 August 2021
Procedural Posture
Representation (trusts) / Appeal From Royal Court
Outcome
Appeal dismissed
Legal Topics
Mistake in Exercise of Trustee Powers, Voidability of Trust Transactions, Inheritance Tax (iht), Court Powers Under Trusts (jersey) Law 2004
Trusts Equity Taxation Mistake in Exercise of Trustee Powers Voidability of Trust Transactions Inheritance Tax (iht) Court Powers Under Trusts (jersey) Law 2004

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Parties

Hawksford Trustees Jersey Limited

Applicant

P

Respondent

C

Third Party

Procedural Posture

Representation (trusts) / Appeal From Royal Court

Legal Issues

  1. 1 Whether the Court can partially avoid a trustee's exercise of power to convert a sale into a gift under Article 47G(2) of the Trusts (Jersey) Law 2004
  2. 2 Whether the Court can substitute a different transaction (donation) for the original sale to avoid IHT charge
  3. 3 Scope of Court's discretion under Article 47G(2)

Ratio Decidendi

The Court's powers under Article 47G(2) of the Trusts (Jersey) Law 2004 do not permit the substitution of a different transaction (gift) for the original sale by partial avoidance; the exercise of power must be avoided wholly or partially, but cannot be transformed into a donation or have its price rewritten solely to achieve a tax advantage.

Court Disposition

Appeal dismissed

Orders

  • No relief granted to applicant
  • Requested declarations and orders refused