The taxpayer made a gift of shares to a trust set up to fund a medical professorship. The shares were in a private company, and an option was given for their repurchase once a certain level of dividends had been attributed to them. He was assessed to substantial surcharges on them on the basis that the arrangement was a settlement under which he retained an interest and of which he had not divested himself absolutely.
Lord Upjohn said: ‘If A intends to give away all his beneficial interest in a piece of property and thinks he has done so but, by some mistake or accident or failure to comply with the requirements of the law, he has failed to do so, either wholly or partially, there will, by operation of law, be a resulting trust for him of the beneficial interest of which he had failed effectually to dispose. If the beneficial interest was in A and he fails to give it away effectively to another or others or on charitable trusts it must remain in him’
Lord Reid, Lord Pearce, Lord Upjohn, Lord Donovan, Lord Wilberforce
[1966] UKHL 3, [1967] 2 AC 291, [1966] UKHL TC – 43 – 519
Bailii, Bailii
Income Tax Act 1952 411 415, Law of Property Act 1925 53
England and Wales
Citing:
Cited – Oughtred v Inland Revenue Commissioners HL 4-Nov-1959
The taxpayer and her son owned through a trust the entire beneficial interest in the shares of a company. She agreed to transfer other shares to him in return for his interest in the shares subject to the trust, releasing the trust. The Revenue . .
Cited – Grey and Another (Hunter’s Nominees) v Inland Revenue Commissioners; Orse Gray v IRC HL 2-Nov-1959
The House considered whether certain instruments which were presented for adjudication to stamp duty under section 13 of the Stamp Act 1891, are or are not chargeable with ad valorem duty.
Held: The word ‘disposition’ is to be given its . .
Cited – Attorney General v Brown 1849
. .
Cited by:
See Also – Re Vandervell’s Trusts (No 2) ChD 17-Jul-1973
The court considered the requirement that a proposed beneficiary must establish some positive act on the part of the person creating the trust for that person to be bound by the trust asserted. Megarry J said: ‘(1) If a transaction fails to make any . .
Lists of cited by and citing cases may be incomplete.
Equity, Income Tax
Leading Case
Updated: 31 October 2021; Ref: scu.248562
