swarb.co.uk - law index
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Trusts - From: 1990 To: 1990
This page lists 5 cases, and was prepared on 02 April 2018.
Windeler v Whitehall [1990] 2 FLR 505
1990
Millett J
Trusts, Family
The plaintiff and defendant lived together but were not married. The plaintiff spent some of a legacy she received on living expenses and supervised minor building works to the family home. She claimed an interest in it. Held. Millett J said: "If this were California, this would be a claim for palimony, but it is England and it is not. English law recognises neither the term nor the obligation to which it gives effect. In this country a husband has a legal obligation to support his wife even if they are living apart. A man has no legal obligation to support his mistress even if they are living together. Accordingly, the Plaintiff does not claim to be supported by the Defendant but brings a claim to a proprietary interest in his business and his home." The works did not constitute a detriment on which she could rely: "Any wife or mistress would do the same. Only a lawyer versed in the authorities but lacking all sense of proportion would consider that such conduct gave her any kind of proprietary interest in the house."
1 Citers
Gibbon v Mitchell [1990] 1 WLR 1304; [1990] 3 All ER 338
1990
ChD
Millett J
Trusts, Equity
G executed a deed surrendering his life interest in a trust fund in order to vest the property in his two children: the deed did not have that effect because of two errors (one of which was ignoring the fact that his life interest was subject to protective trusts), with the result that the fund became subject to discretionary trusts for the remainder of his life and only then would it vest in his two children, and also in further as yet unborn children. He was not advised that the effects of the deed would be to bring about a forfeiture of his life interest and thus invoke the operation of the discretionary trusts provided for in s 33 of the Trustee Act 1925. In fact, in entering the deed on the advice of his solicitors, the plaintiff had intended to reduce the effects of inheritance tax which would be incurred if the terms of the settlement, in which he purported to surrender his life interest, remained in force. Held: This was a case, not for rectification, but for setting aside for mistake. When challenging the decisions of trustees using the rule in Hastings-Bass, looking at considerations of the actual or potential adverse tax consequences of the exercise of the power are not relevant. The court limited the jurisdiction to set aside for mistake to cases where there is a mistake of law or fact as to the effect of the transaction itself as opposed merely to the consequence or advantages to be gained by entering into it.
Millett J reviewed the authorities and said: "In my judgment, these cases show that, wherever there is a voluntary transaction by which one party intends to confer bounty on another, the deed will be set aside if the court is satisfied that the disponor did not intend the transaction to have the effect that it did. It will be set aside for mistake whether the mistake is a mistake of law or of fact, so long as the mistake is as to the effect of the transaction itself and not merely as to its consequences or the advantages to be gained by entering into it. The proposition that equity will never relieve against mistakes of law is clearly too widely stated." and "Mr Gibbon did not merely execute the deed under a mistake of law as to the legal consequences of his doing so. He executed it under a mistake as to its legal effect . . Since its effect was not that which he intended, he is entitled to have it set aside."
Trustee Act 1925 33
1 Cites
1 Citers
Mettoy Pension Trustees v Evans [1990] 1 WLR 1587
1990
ChD
Warner J
Trusts
Where a trustee acts under a discretion given to him by the terms of the trust the court will interfere with his action if it is clear that he would not have so acted as he did had he not failed to take into account considerations which he ought to have taken into account. The exercise to be undertaken by the court in deciding whether the trustee has so acted, where it is claimed that the rule in Hastings-Bass applies, three questions arise. What were the trustees under a duty to consider? Did they fail to consider it? If so, what would they have done if they had considered it? Pensionsschemes may have to be considered against their fiscal background.
Warner J talked of the Hastings-Bass principle: "I have come to the conclusion that there is a principle which may be labelled the rule in Hastings-Bass. I do not think that the application of that principle is confined, as Mr Nugee suggested, to cases where an exercise by trustees of a discretion vested in them is partially ineffective because of some rule of law or because of some limit on their discretion which they overlooked. If, as I believe, the reason for the application of the principle is the failure of the trustees to take into account considerations that they ought to have taken into account, it cannot matter whether that failure is due to their having overlooked (or to their legal advisers having overlooked) some relevant rule of law or limit on their discretion, or is due to some other cause.
For the principle to apply, however, it is not enough that it should be shown that the trustees did not have a proper understanding of the effect of their act. It must also be clear that, had they had a proper understanding of it, they would not have acted as they did." and
"In a case such as this, where it is claimed that the rule in Hastings-Bass applies, three questions arise: (1) What were the trustees under a duty to consider? (2) Did they fail to consider it? (3) If so, what would they have done if they had considered it?"
1 Cites
1 Citers
Stannard v Fisons Ltd; Stannard v Fisons Pensions Trust [1990] 1 PLR 179; (1992) IRLR 27; [1991] Pen LR 225
2 Jan 1990
CA
Trusts, Equity
The purchaser of a business said that the company had made insufficient contributions to its pensions fund before the transfer, and sought payment of the sums underpaid. The defendants argued that, applying Hastings-Bass, unless that principle were satisfied, the trustees' decision as to the amount to be transferred should not be disturbed. Held: Hastings-Bass and Mettoy involved the voluntary exercise by trustees of a discretion, whereas here the trustees were under an obligation to exercise their discretion at a particular time and after fulfilling a given condition. Having found that they had not complied with that obligation, so that the question was how their failure to perform that obligation should be remedied.
1 Cites
1 Citers
Lloyds Bank plc v Rosset; HL 29-Mar-1990 - [1991] 1 AC 107; [1990] 2 WLR 867; [1990] 1 All ER 1111; [1990] UKHL 4; [1990] UKHL 14
