Representation of RBC Trustees (Jersey) Limited re the L M Will Trust [2024] JRC 107 (10 May 2024)

Representation of RBC Trustees (Jersey) Limited re the L M Will Trust [2024] JRC 107 (10 May 2024)

The Trustee made distributions based on incorrect tax advice, resulting in a serious mistake regarding UK tax consequences. The mistake was sufficiently serious to justify setting aside the distributions under Article 47G. The Court would also have granted relief under Article 47H for inadequate deliberation. Consequential relief was considered but not granted without hearing from affected parties.

Citation
[2024] JRC 107
Parties
Applicant: RBC Trustees (Jersey) Limited; Beneficiary/respondent: B; Beneficiary/respondent: L M Charitable Foundation; Beneficiary/respondent: E; Beneficiary/respondent: W
Jurisdiction
Jersey
Judgment Date
10 May 2024
Procedural Posture
Representation / Judgment on Application to Set Aside Distributions
Outcome
Application granted in part
Legal Topics
Mistake in Trust Administration, Tax Consequences of Trust Distributions, Setting Aside Distributions, Consequential Relief
Trusts Taxation Equity Mistake in Trust Administration Tax Consequences of Trust Distributions Setting Aside Distributions Consequential Relief

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Parties

RBC Trustees (Jersey) Limited

Applicant

B

Beneficiary/respondent

L M Charitable Foundation

Beneficiary/respondent

E

Beneficiary/respondent

W

Beneficiary/respondent

Procedural Posture

Representation / Judgment on Application to Set Aside Distributions

Legal Issues

  1. 1 Whether distributions from the Will Trust should be set aside due to mistake under Article 47G of the Trusts (Jersey) Law 1984
  2. 2 Whether distributions should be set aside due to inadequate deliberation under Article 47H
  3. 3 Consequential relief following setting aside distributions

Ratio Decidendi

The Trustee made distributions based on incorrect tax advice, resulting in a serious mistake regarding UK tax consequences. The mistake was sufficiently serious to justify setting aside the distributions under Article 47G. The Court would also have granted relief under Article 47H for inadequate deliberation. Consequential relief was considered but not granted without hearing from affected parties.

Court Disposition

Application granted in part

Orders

  • Distributions from the Will Trust to B between 2015 and 2018 are declared voidable and set aside, of no effect from the time they were made under Article 47G.
  • Trustee may have its costs of and incidental to the Representation from the assets of the Will Trust on the indemnity basis.