In re S Trust v [2011] JLR 375 (21 June 2011)

In re S Trust v [2011] JLR 375 (21 June 2011)

A mistaken belief by the settlor, arising from incorrect advice regarding tax consequences, can justify setting aside a voluntary disposition into trust if the mistake is fundamental and the settlor would not have acted but for the mistake.

Citation
[2011] JLR 375
Parties
Applicant: Settlor/Donor; Respondent: Donee/Trustee
Jurisdiction
Jersey
Judgment Date
21 June 2011
Procedural Posture
Trust Law Application / Judgment
Outcome
Disposition set aside
Legal Topics
Mistake by Settlor, Setting Aside Voluntary Disposition, Tax Consequences
Trusts Mistake by Settlor Setting Aside Voluntary Disposition Tax Consequences

Case Brief

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Parties

Settlor/Donor

Applicant

Donee/Trustee

Respondent

Procedural Posture

Trust Law Application / Judgment

Legal Issues

  1. 1 Whether a voluntary distribution into trust can be set aside for mistake by the settlor/donor
  2. 2 Whether the mistake was sufficiently serious to render the transaction voidable

Ratio Decidendi

A mistaken belief by the settlor, arising from incorrect advice regarding tax consequences, can justify setting aside a voluntary disposition into trust if the mistake is fundamental and the settlor would not have acted but for the mistake.

Court Disposition

Disposition set aside

Orders

  • Voluntary distribution into trust set aside due to mistake by settlor/donor