{"id":1411,"date":"2015-01-26T15:43:15","date_gmt":"2015-01-26T15:43:15","guid":{"rendered":"https:\/\/thor.ca\/\/blog\/?p=1411"},"modified":"2015-01-26T15:43:15","modified_gmt":"2015-01-26T15:43:15","slug":"uk-court-rescinds-non-contractual-voluntary-distribution-from-trust","status":"publish","type":"post","link":"https:\/\/www.thor.ca\/blog\/2015\/01\/uk-court-rescinds-non-contractual-voluntary-distribution-from-trust\/","title":{"rendered":"UK Court rescinds non-contractual voluntary distribution from trust"},"content":{"rendered":"<p>In <a href=\"http:\/\/thor.ca\/blog\/wp-content\/uploads\/2015\/01\/2014-EWHC-4129.pdf\"><em>Kennedy &amp; Ors v. Kennedy &amp; Ors<\/em><\/a>, [2014] EWHC 4129 (Ch), a voluntary distribution (appointment) of shares was mistakenly made from a trust to a beneficiary, generating a large tax liability in the UK.\u00a0 The UK\u2019s High Court of Justice Chancery Division said the principles set out in <em>Pitt v Holt<\/em>, [2013] 2 AC 108 were satisfied in this case. The beneficiary mistakenly believed the particular clause in the document, which distributed the <em>entire<\/em> remainder of the trust fund <em>including<\/em> the shares, gave effect to his earlier instructions under which the particular shares were <em>not<\/em> to be distributed to him.\u00a0 The trustees mistakenly believed the clause was in accordance with the beneficiary\u2019s instructions (paragraph 37).\u00a0 These mistakes were causative and very serious (paragraph 38), did not involve artificial tax avoidance (paragraph 39), and were such that it would be unjust to leave them uncorrected (paragraph 36).\u00a0 As to the remedy, the mistake made the non-contractual voluntary disposition voidable in equity not void at law (paragraph 41).\u00a0 The equitable remedy of rectification was not available on the evidence, as this would mean rewriting the clause to exclude from the distribution the particular shares only (paragraph 43).\u00a0 The equitable remedy of rescission applied because the clause was self-contained and severable and could be rescinded in its entirety (paragraph 46).<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In <a href=\"http:\/\/thor.ca\/blog\/wp-content\/uploads\/2015\/01\/2014-EWHC-4129.pdf\"><em>Kennedy &amp; Ors v. Kennedy &amp; Ors<\/em><\/a>, [2014] EWHC 4129 (Ch), a voluntary distribution (appointment) of shares was mistakenly made from a trust to a beneficiary, generating a large tax liability in the UK.\u00a0 The UK\u2019s High Court&hellip;<\/p>\n","protected":false},"author":11,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[],"class_list":["post-1411","post","type-post","status-publish","format-standard","hentry","category-corporate-tax"],"_links":{"self":[{"href":"https:\/\/www.thor.ca\/blog\/wp-json\/wp\/v2\/posts\/1411","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.thor.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.thor.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.thor.ca\/blog\/wp-json\/wp\/v2\/users\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/www.thor.ca\/blog\/wp-json\/wp\/v2\/comments?post=1411"}],"version-history":[{"count":0,"href":"https:\/\/www.thor.ca\/blog\/wp-json\/wp\/v2\/posts\/1411\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.thor.ca\/blog\/wp-json\/wp\/v2\/media?parent=1411"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.thor.ca\/blog\/wp-json\/wp\/v2\/categories?post=1411"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.thor.ca\/blog\/wp-json\/wp\/v2\/tags?post=1411"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}