Re Weston's Settlements
The court refused to approve a variation of a trust that would move it abroad to avoid tax, because the benefit to the children did not outweigh the disadvantages.
Facts
Mr Weston had created two settlements for his sons. To avoid capital gains tax, he proposed to move the trusts to Jersey, where the family had recently gone to live, by appointing new trustees there. He applied to the court under the Variation of Trusts Act 1958 to approve the arrangement on behalf of the minor and unborn beneficiaries.
Legal principle
The Court of Appeal refused to approve the arrangement. Lord Denning MR said that the court should consider not only the financial benefit to the beneficiaries, but also their educational and social benefit. The court should not consider merely money, and the children might be better off being brought up in England, where they had their roots, than in Jersey for tax reasons. The family had only recently moved there, and there was no guarantee that they would stay.
Related cases on trustees: duties, powers and variation of trusts
- Bartlett v Barclays Bank Trust Co Ltd (No 1) [1980] Ch 515
- Butler-Sloss v Charity Commission for England and Wales [2022] EWHC 974 (Ch), [2022] Ch 371
- Chapman v Chapman [1954] AC 429
- Cowan v Scargill [1985] Ch 270
- Goulding v James [1997] 2 All ER 239
- Harries v Church Commissioners for England [1992] 1 WLR 1241
- Learoyd v Whiteley (1887) 12 App Cas 727
- Re Lucking's Will Trusts [1968] 1 WLR 866
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