The rule in Hastings Bass, and the intervention of HMRC in the Gresh case in Guernsey
The Rule in Hastings Bass has been a part of Jersey law since Re Green GLG Trust  JLR 571; (2003) 5 ITELR 590 (and see also In Re Toland  JRC 142 and Alhamrani v Alhamrani  JRC 168 @ para ), and three more recent cases, Re Winton Investment Trust; Seaton Trustees Ltd v Morgan (2008) 11 ITELR 1;  JRC 206, Re the Howe Family Number 1 Trust; Leumi Overseas Trust Corporation Ltd v Howe (2008) 11 ITELR 14;  JRC 248, and In Re Representation of Vistra Trust Company Jersey Limited  JRC 111 all considered the scope of the Rule further. But until now there have been no similar decisions in Guernsey. The case of RBC Trustees v Gresh changes all that, but its interest lies not only in being the first of its kind (and in one of the last jurisdictions to recognise the Rule), but also because it is the first case in which HMRC have taken more than a passing interest, to the point where they recently overturned a first instance decision denying them the right to intervene, and are now party to the proceedings. This article looks at Gresh so far and considers its implications both for Guernsey, and perhaps for Hastings Bass (and similar matters) generally.
Origins of the rule in Hastings Bass
The Hastings Bass Rule is an exception to the general principle that a Court will not interfere in a decision reached following the exercise of a trustee power or discretion.1 Although not strictly the first case to deal with it (compare Re Pilkington’s WT  Ch 466 (CA) and  AC 612 (HL), and In re Abrahams Will Trust  1 Ch 433), the Rule’s origins can be traced back to the decision of Buckley J in the English Court of Appeal in Re Hastings-Bass (dec’d), Hastings v IRC  Ch 25, where he said ‘To sum up the preceding observations, in our judgment, where by the terms of a trust (as under s 32) a trustee is given a discretion as to some matter under which he acts in good faith, the court should not interfere with his action notwithstanding that it does not have the full effect which he intended, unless (1) what he has achieved is unauthorised by the power conferred on him, or (2) it is clear that he would not have acted as he did (a) had he not taken into account considerations which he should not have taken into account, or (b) had he not failed to take into account considerations which he ought to have taken into account’.2 Although that formulation has been reshaped on a number of occasions since, it still broadly states the principle, the definitive statement of which is now that of Lloyd LJ in Sieff v Fox,3 where he said the Rule was that ‘Where trustees act under a discretion given to them by the terms of the trust, in circumstances in which they are free to decide whether or not to exercise that discretion, but the effect of the exercise is different from that which they intended, the court will interfere with their action if it is clear that they would not have acted as they did had they not failed to take into account considerations which they ought not to have taken into account, or taken into account considerations which they ought to have taken into account….’4 In Jersey, in Green, the Rule was said to be ‘… but a manifestation of the general principle that a trustee must act in good faith, responsibly and reasonably …’,5 and that it ‘… merely elaborated the position by making it clear that a decision of a trustee was … liable to be quashed where the trustee had taken account of irrelevant factors or has ignored relevant ones. In this respect there is a parallel with the well known grounds of judicial review for quashing the decision of a public authority’.6
It is hard to find clear judicial explanation for the rationale behind the Rule, but what little there is suggests that it is a breach of the trustee’s duty to give proper consideration to the exercise of its fiduciary powers, which will engage it.7 And furthermore, the argument goes, if an insufficiently considered decision is made, that decision is void ab initio in equity because it is a necessary pre-condition for the valid exercise of the power or discretion in question, that proper consideration has been given to it.8 Hence, the decision of Lightman J in Abacus Trust Co. (IOM) v Barr, to the effect that the successful application of the Rule meant a decision was voidable,9 not void, stands alone and has not been followed.10
Criticism of the Rule
The Rule has never been without its critics, especially as the last few years have seen many instances of trustees successfully using it to set aside something they did in error, largely with a view to avoiding the serious tax consequences which would arise were their decision to stand.11 But equally, there have been concerns raised about the scope of the Rule as a convenient ‘self help remedy’, where trustees make a wrong or unfortunate decision. For instance, in Breadner v Granville-Grossman  Ch 523, Park J said that ‘…It cannot be right that wherever trustees do something which they later regret and think that they ought not to have done, they can say that they never did it in the first place’,12 and the morning after and get out of gaol free analogies are by now too well known. On other occasions, for instance in Green in Jersey, it was suggested (albeit rejected) that especially where the trustee’s mistake is attributable to reliance on incorrect advice, the matter is better resolved by the trustee instituting proceedings for professional negligence against the adviser.13 Now once more, one detects a new wave of criticism (albeit based on largely old arguments) in recent extra judicial writings,14 so that, maintaining the littoral analogy, the tide may be finally turning against the Rule, at least in its present wide scope. So one explanation for HMRC’s stance in the Gresh case may be that they have sensed that change of tide, and seen the opportunity to challenge the scope of the Rule in Guernsey as a prelude to a more concerted attack on it in the English Courts. Indeed, during the course of the Appeal Court hearing in Gresh it emerged that HMRC have been joined in an English case on the Rule as well.
Hastings Bass and the role of HMRC
Historically, given that many cases result in a saving of tax, one might have thought HMRC would have taken a keener interest, as the practice has always been to notify them. But thus far they have not actively done so. Until Gresh that is, and also now in England. When news first broke of Gresh, there was surprise, as it was unclear why HMRC had responded to Lloyd LJ’s encouragement in Sieff v Fox WLR 3811 @ para ) by taking part in a case, not in the UK, but in a foreign Court, and there was speculation as to their motivation for so doing. What in particular, had HMRC to gain by seeking to show (presumably) that either (1) as a matter of Guernsey law, the Rule in Hastings Bass had no application or even was flawed in principle (surely unlikely at least at first instance), or (2) that relief under the Rule was available as a matter of Guernsey law, but just not on the pleaded facts? Also, would not an attempt by HMRC to intervene in overseas proceedings run the risk of being met with the objection that their involvement was contrary to the well known rule in Government of India v Taylor, because it amounted to indirect enforcement of foreign tax? Now, that second point had some force, because earlier, in Jersey, and even before their move to intervene in Guernsey, HMRC had written to the Jersey Court (but been denied locus to intervene) in a Hastings Bass case called In Re Seaton Trustees Limited  JRC 050. In that case, but admittedly without the benefit of argument, Clyde Smith Esq. Commr. said that ‘“…HMRC… has no interest in the application (only in the UK tax consequences that may follow from it) and therefore has no locus standi upon which to seek to intervene’ ( JRC 050 @ para ). That seems clear enough, and in fact Seaton was not the first case in the Channel Islands where HMRC had done more than decline to appear, as again in Jersey, but about 12 months before Seaton, in In Re Vistra Trust Company (Jersey) Limited  JRC 111, HMRC was notified but wrote ‘…to say that it [had] no necessity to appear unless the Court wishes its tax bulletin to be explained’. As things turned out in that case, that did not prove necessary, as the Jersey Court reviewed the bulletin itself and the trustee’s advocate explained certain aspects of it instead ( JRC 111 @ ).
By ‘bulletin’ of course, HMRC meant HM Revenue and Customs Tax Bulletin (TB 83 June 2006), in which they set out their position in relation to the Hastings Bass Rule. In essence, they argued (1) that due to the ‘…logically flawed positive reformulation of the [rule] in Mettoy15 the Rule should be restated to say that the Court ‘may’ rather than ‘will’ interfere with the trustee’s decision, (2) that the Rule’s effect should be that the decision is voidable, not void, or at least give the Court the ability to take into account of similar equitable considerations as for other relief, (3) that the Rule should be assimilated with other principles by which trustee discretions are impugned, or voluntary transactions are set aside for mistake, (4) that in accordance with Lloyd LJ in Sieff v Fox, the test should be the trustee ‘would’ not ‘might’ have acted differently, (5) that a distinction should be drawn between cases where trustees fail to take account of the tax consequences of their decisions, and cases where account is taken of incorrect tax advice, arguing that the Rule should apply to the former, but not the latter, and (6) that where negligent advice is received on which the trustee relies, the trustee should resort to professional negligence litigation with the advisor to resolve the matter.
It seems from Seaton that HMRC’s efforts in that case centred around point (3), in the sense that they contended there was no ‘fundamental misunderstanding as to the effect of the transaction’ in question, and points (5) and (6), where the argument was put that the proper course should have been for the trustees to sue the accountants on whose incorrect advice they had relied. But surely, neither of these points were likely to succeed, at least in Jersey. As to the required quality of the mistake, even if at some point, a decision were to be taken that it is time to assimilate the test for mistake in Hastings Bass relief, with that in Ogilvie v Littleboy for rescission, or even with the Gallie v Lee16 or Great Peace17 tests for non est factum and contractual mistake respectively, a step like that would most unlikely be taken in the Jersey Court, when it hasn’t yet been taken in England and Wales. And as to suing professional advisers, the position with regard to professional negligence litigation had been made very clear in Jersey and against HMRC, as early as Green,18 and it seems most unlikely that the Court in Seaton would have taken a different view. But HMRC had a third point, which was that the purpose of the Rule in Hastings Bass was ‘…to protect beneficiaries of a trust from a decision taken by trustees that would not have been taken (or taken in a different way) had the trustees thought about it fully’. In Seaton it was argued that it was the settlor, not the trustees, who were liable for the tax, so it was said the trust had suffered no loss justifying the engagement of the Rule. The reference to loss as a justification was novel, and Clyde Smith rejected it as being without support, pointing out that in a number of other cases, including Leumi19 and the earlier Seaton20 case, it was the settlor who suffered the tax. But he might just as well have said that being an exceptional instance in which a Court will interfere with the exercise of a trustee discretion, as it stands, Hastings Bass has nothing to do with loss to the trust (much as it has nothing to do with fault), but has instead as its sole focus, the trustee’s decision-making process, and the matters which formed part of that process. Indeed looked at in this way, it is tempting to think Hastings Bass is not necessarily even founded in mistake as such, but is rather wider, as mispredictions for instance, would surely constitute ‘irrelevant’ considerations for the purposes of identifying a breach of the trustee’s fiduciary duty to consider, but do not amount to vitiating mistakes (and hence ‘unjust factors’) for the purposes of a common law claim in autonomous unjust enrichment.21 If that is right, then those who seek to assimilate the Rule’s test for mistake with that for mistake elsewhere, are themselves in error, and our most significant mistake of all might have been to think the Rule was founded purely on mistake in the first place. But anyhow, back to Gresh and HMRC.
The Gresh case – Royal Court at first instance
HMRC were no more successful in Guernsey in Gresh at first instance than they were in Jersey in Seaton, as on 29 May 2009, Collas DB handed down his judgment, in which he refused HMRC leave to intervene in the proceedings under Rule 37(1)(b)(ii) of the Guernsey Royal Court Civil Rules 2007 (which replaced Rule 34 of the former Royal Court Civil Rules1989, which was based on the similar RSC Ord 15, r. 6(2)). Rule 37 says that ‘The Court may in any proceedings order that… one person… between whom and any party to the proceedings there exists a question or issue arising out of or relating to or connected with any relief or remedy claimed in the proceedings which, in the opinion of the Court, it would be just and convenient to determine as between him and that party as well as between the parties to the proceedings… shall be added as a party’. Gresh involved an application by the trustee to set aside distributions made in lump sum (not periodic form) to Mr Gresh from a pension scheme in November 2006 and January 2007 which were potentially taxable at 40 per cent. Collas DB agreed with HMRC’s Counsel that there were three limbs of Rule 37(1)(b)(ii) that had to be satisfied, namely (1) that there must be a question or issue between HMRC and a party to the proceedings, (2) which arose out of or was related to or connected with any relief or remedy claimed, and (3) which it would be just and convenient to determine as between HMRC and that party.22 What he did not agree with, however, was that the common issue was, as HMRC had argued, ‘…the validity, or otherwise, of the distributions made by RBC to Mr Gresh’.23 Instead the issue for the Court in the Hastings Bass application was in his view ‘…whether RBC’s decisions to make the distributions should be void ab initio.''24 That would involve the Court looking at the circumstances in which the distributions were made, and what was known to RBC at the time. The Court then would have to consider whether, as a matter of Guernsey law, it had power to set aside the distributions, and if so, whether it should do so. The parties who were directly affected by that issue were the trustee and the beneficiaries, including Mr Gresh, and because the issue was one of Guernsey law, the Guernsey Court was competent to deal with it.25 By contrast, the issue between HMRC and Mr Gresh was ‘…whether he has, or will have, any liability to UK Income Tax arising from the distributions and/or from the scheme that is now proposed’,26 which was not the same as the issue to be decided in the Hastings Bass application.27 Hence limbs (1) and (2) to Rule 37 were not satisfied. Furthermore, even if that was wrong, and the issue of Mr Gresh’s liability to UK income tax was something which arose from, or related to or was connected with the application, the extent of Mr Gresh’s liability to UK income tax was not a matter which the Guernsey Court could and would determine, so limb (3) to Rule 37 was not satisfied.27 Nor did Collas DB consider it just and convenient to determine that issue, as it amounted to indirect enforcement of UK tax28 and was hence contrary to the Government of India principle.
In argument HMRC’s counsel had made something of the comments of Lord Walker in 2002 in his lecture at Kings College,29 and suggested that if HMRC were not convened, the matter would proceed without the Court correctly interpreting the legal principles involved, given the Hastings Bass Rule’s piecemeal development. That argument too was rejected, as there was no suggestion the application would in effect be ‘undefended’30 if HMRC was not present. One reason for that was that the Court had convened the Amicus Curiae to the proceedings and he could assist where appropriate, on issues of fact or law. However, even without the Amicus, the Court could adopt an inquisitorial stance30 and it was important to appreciate that when determining the matter, the Court would not simply look to English law to establish what was the relevant law in Guernsey. Hence (following Spread v Hutcheson)31 English decisions on Hastings Bass would ‘…be a starting point but… [would] need to be considered in the light of Guernsey customary and statutory law.'32 Furthermore, HMRC could if it wished, make written submissions to the Court on the substantive hearing.33 Finally, a concession that if allowed to join, HMRC would agree to be bound by the Guernsey Court’s verdict as to the validity or otherwise of the distributions in question (when in actual fact it said it could re-litigate the point before the Special Commissioners), was rejected on grounds of comity and because the Guernsey Court, and not the Commissioners, was surely the competent forum to decide that issue.34
HMRC appealed, were refused leave to appeal, but appealed the refusal to grant leave. The result of all that, under Guernsey civil procedure,35 was that the Court of Appeal heard the matter in full on 14 September 2009.
Court of Appeal judgment
The decision of the Guernsey Appeal Court,36 which was handed down on 16 September 2009, reversed Collas DB’s decision, saying in the process that the judgment of the Jersey Royal Court in Seaton‘…where that court said at paragraph 23 that HMRC had no interest in a similar Hastings Bass application, only in the UK tax consequences that may flow from it’, was (if the circumstances in Seaton and Gresh were the same), mistaken.37 The Appeal Court began by noting that it was common ground that under Rule 37 of the Royal Court Civil Rules2007(1) there had to be a question or issue between HMRC and Mr Gresh, which (2) arose out of or related to or was connected with any relief or remedy claimed in the proceedings, and (3) that it was just and convenient to determine that issue between Mr Gresh and HMRC as well as between the parties to the proceedings.38 As we have heard, Collas DB had held that the only issue between Gresh and HMRC was whether UK tax was payable in the circumstances, which he said was different from whether the distribution in question was void ab initio, and something which would not in any event be decided by the Guernsey Court. He had gone on to say that nor was it just or convenient for HMRC to be joined because (1) their willingness to be bound only if joined did not justify joinder, (2) the validity of the distribution would not have to be separately litigated even if HMRC were not joined (3) the proceedings still would be defended or properly defended even if HMRC were not joined, (4) HMRC could still make written submissions, and (5) HMRC were by their application seeking to indirectly enforce foreign revenue law.39
HMRC’s grounds of appeal were (1) that the issue between Mr Gresh and HMRC was simply the validity of the distribution, and that was something which was to be determined in the Guernsey proceedings and the issue of Mr Gresh’s tax liability was merely connected with that, (2) HMRC were seeking to take part in an issue which affects their right to tax, but which required the Guernsey Court to recognise that right, not enforce it, and (3) it was just and convenient for HMRC to be joined, as they would not be bound unless joined so that the validity of the distribution would need to be re-litigated, and because the Guernsey proceedings would not be properly defended unless they were joined.40
The Appeal Court thought the issues between HMRC and Mr Gresh were (1) whether the distribution was void (in which case no tax was payable) or voidable or valid (in which case tax was potentially payable) and (2) whether the distribution was subject to English tax.41 If HMRC was not joined, and the matter then proceeded in England, the first of those issues would become whether the Guernsey decision should be recognised and applied, and if not, whether the Guernsey Court was right to hold the distribution was void (or perhaps voidable).42 Whatever the position, however, ‘…the primary question that [needed] to be resolved between [HMRC and Gresh] [was] whether the distribution [was] valid or void… [as]... This [was] the essential precursor to any liability to UK tax.'43 The first issue before the Guernsey Court in the proceedings was ‘Whether in accordance with section 69 of the Trusts (Guernsey) Law 2007 and the Rule in Hastings Bass, the distribution would be declared void ab initio or voidable…',44 and that was ‘in substance……..very similar or identical to' 45 the primary issue between HMRC and Mr Gresh. The Deputy Bailiff had been wrong not to recognise the validity or otherwise of the distribution as a prior and potentially determinative issue, and had unduly focused upon the question of tax.46 HMRC’s interest was not simply a commercial one, but was instead a direct existing (not contingent) issue.47
Of course, the decision has given rise to a lot of concern, both for trustees hoping perhaps themselves to rely on the Rule at some point, but also even for Guernsey as a jurisdiction. But on analysis, that concern is probably ill founded. The intervention of HMRC in a case being heard in the Guernsey Court is unexpected, but not inconsistent with principle. We have heard already that in England, HMRC were being encouraged to intervene in Hastings Bass cases, to ensure that the matter was fully argued and so that the extent of the Rule’s effect on third parties potentially affected could be clarified. There is no obvious reason why the position should be any different in Guernsey. Moreover it is crucial to note that HMRC were found by the Court of Appeal, by their intervention, not to be indirectly enforcing foreign tax, but rather (as in the Re State of Norway case) ‘…resolving an issue which may be important to the authority in due course in enforcing… foreign revenue legislation in its own home state’,48 and that does seem right. As to whether it was just and convenient for HMRC to be joined, the Appeal Court made a number of observations. First, there was advantage to having HMRC present to test the factual evidence before the Court. Also, given its experience in dealing with the issues raised by the Hastings Bass cases, its input would be valuable in determining the extent of the Rule even in Guernsey. Furthermore, unless HMRC was joined, there was no real likelihood of an appeal in which a higher Court would have the opportunity to consider the importance of the Rule generally.
Above all, however, the most important point was that the Appeal Court thought Collas DB had been wrong to assume that the matter would not be re-litigated if HMRC were not joined. The correct position was ‘HMRC have said, as we think they are entitled to do, that they would not accept a ruling of the Guernsey Court as binding unless they were a party (see In Re Vandervell’s Trusts  A.C. 912 per Lord Reid at page 928 C-D). Whatever one may think about the prospects of HMRC persuading a different court or Tax Tribunal to depart from such a decision, it would undoubtedly be their privilege to attempt to do so. But if HMRC are joined they have accepted and agreed that they will not challenge the outcome even in UK proceedings. This will avoid re-litigation of the issue of the validity of the Distribution, and will lead to a saving of time and costs for all parties.'49
Clearly, the Appeal Court thought the circumstances of the case were relatively unusual, and that their decision would not lead to a tide of cases in which HMRC would intervene in overseas Courts. They also pointed to the highly contentious nature of the Hastings Bass Rule, and thought that in most other normal trust disputes, the requirements for HMRC’s joinder would not be made out. That may be so, as in many such cases, HMRC would have no interest. But cases involving for instance, rectification or rescission, are likely to raise similar issues to those in Hastings Bass, so we might expect their involvement in matters of that sort, and indeed, I believSieffe it is already the practice to notify them of such proceedings. Presumably, in those cases, HMRC’s locus will be important, as the general view seems to be that if a discretion is void in equity, HMRC may challenge,50 but not if it is merely voidable where the right to challenge rests only with the beneficiaries, (although in that case HMRC may51 be able to resist the beneficiaries’ application as a bona fide purchaser). None of that was argued in Gresh, and it would be improper for me to argue it now in this article, as I believe the possibility of an appeal to the Privy Council remains and the matter is therefore sub judice.
The final point of note is that the Appeal Court seemed quite contrary to the idea of Hastings Bass as a matter of principle, even though they do not (and could not) say so in their judgment on HMRC’s joinder. We do not know yet what HMRC will say in the substantive hearing, which is due to take place in early December. So any wider speculation as to what Gresh will add to learning on the Rule is premature. But my analysis at this stage, is not (as some seem to think) that the Appeal Court has given HMRC free reign to enforce English tax in the Guernsey Court. Rather it is that Gresh might be part of the beginning of the end for the Rule itself, or at least a move towards substantially clarifying its scope.
- 1. See, e.g. NBPF Pension Trustees Limited v Michael Warnock Smith and others  EWHC 455 @ para  quoting Edge v Pensions Ombudsman  CH 512 @ 534B approved by the Court of Appeal in  3 WLR 79 @ 100H – 103E.
- 2.  Ch25 @ 41.
- 3.  1 WLR 3811.
- 4.  1 WLR 3811 @ 3848 @ para .
- 5. (2002) JLR 571 @ 580.
- 6. (2002) JLR 571 @ 581.
- 7. The precise foundation on which the Rule rests is elusive, but while it is hard to find specific authority for the proposition, the underlying rationale lies in the trustee’s fiduciary duty to consider, so that ‘…the reason for the application of the [Rule] is the failure by the trustees to take account of considerations that they ought to have taken into account’ (per Warner J in Mettoy Pension Trustees Ltd v Evans  IWLR 1587 @ 1624B) and it is a breach of that fiduciary duty to consider (e.g. Kerr v British Leyland (Staff) Trustees Ltd (1986)  WTLR 1071 @ 1080B) which triggers the Rule’s potential application (see especially Brian Green QC ‘The law relating to trustees’ mistakes – where are we now?’ Trust Law International, Vol. 17 No. 3, 2003 p. 114 @ 116 (emphasis added): ‘At the heart of the Hastings Bass principle as it has developed is the existence of the trustee’s duty to consider by which is meant to give properly informed consideration to - the exercise of its fiduciary discretion, before purporting to exercise a power vested in it in its trustee capacity. A breach of the duty to consider is a breach of fiduciary duty, and a platform from which the court may intervene. It is the existence of, and breach of, this fiduciary duty which justifies the existence of the Hastings Bass principle as a distinct device for dealing with a trustee’s errors’). This approach to the basis for the Rule was endorsed by Special Commissioner Julian Ghosh QC in Thorpe v HMRC  WL 2148193 @ paras - where he said the Rule ‘… is predicated on the assumption that where the trustees have failed to take into account [any]… relevant consideration… they have failed in their fiduciary duties… and accordingly, the proposed exercise of the power is vitiated’.
- 8. Again, this is not something which has ever been clearly expressed judicially, the main proponents now being Underhill & Hayton (17th Edn, LexisNexis/Butterworths, 2006) para 61.22, but criticised by Nolan, CLJ 2009, ‘Controlling Fiduciary Power’ at p. 308.
- 9.  Ch 409 @ para .
- 10. Surely surprisingly, as one would have thought that the flaw in the Underhill & Hayton approach, is the very fact that historically, the principle has been based on the breach of the duty to consider, which would suggest it was only the objects of that duty, and not any third party, who had the right to impugn the decision in question. There is ample support for the proposition that decisions of trustees affected by breach of fiduciary duty are voidable at the instance of the beneficiaries, not void, so that any affected third party may defend an application as a bona fide purchaser (e.g. Re Eastgate ex parte Ward  1 KB 465). The rationale for the Rule has never been that the exercise of the power was in effect ultra vires and void. Nor is the analogy with Turner v Turner  Ch 100 convincing, as there the Court regarded the trustees never to have considered their discretion at all (hence the exercise was void). Hastings Bass cases by contrast, are cases where the trustees do consider, but in a manner which constitutes a breach of their duty to do so, and are hence directed at the process of consideration; furthermore, Buckley J’s formulation of the Rule in Hastings Bass itself (para 2 above) anticipates that it is an alternative to the situation where the trustee acts in a manner unauthorised by the terms of the trust.
- 11. See, e.g. Green v Cobham  STC 820.
- 12.  CH 523 @ 543 para. ; words echoed in Green (2002) JLR571 @ 576, para. .
- 13.  JLR 571 @ 581-82.
- 14. See, e.g. Trusts & Trustees, Vol 15, Issue 4, June 2009, articles by Lord Neuberger, Sir Gavin Lightman and Tony Molloy QC; see also Trusts & Trustees, Vol 15, Issue 8, October 2009, article by Steven Kempster.
- 15.  1 WLR 1587.....’,
- 16.  AC 1004 @ 1026, where the test is radical or fundamental difference.
- 17.  QB 679 @ 708, where the test is that the contract is ‘“essentially different’.
- 18. (2002) JLR 571 @ 581-82.
- 19.  JRC 248.
- 20.  JRC 206.
- 21. See, e.g. Kleinwort Benson Ltd v Lincoln CC  2 AC 349 @ 398 and Dextra Bank & Trust Company Ltd v Bank of Jamaica  1 All ER 193; a similar point can be made to resolve the argument that the Hastings Bass Rule should not permit a discretion to be annulled on the ground of its consequences, and not simply its effect, when the equitable jurisdiction to rescind voluntary dispositions for mistake (at least under the Gibbon v Mitchell, not the Ogilvie v Littleboy test) extends only to effect. The answer to that is surely that the trustees’ duty to consider (which founds the Rule) extends to the consequences (including as to tax) of their actions, whereas the rescission jurisdiction is concerned only with what the disponor thought it was doing when it made (and by making) the disposition in question.
- 22. Paras  and  of the judgment.
- 23. Para  of the judgment.
- 24. Para  of the judgment.
- 25. Para  of the judgment.
- 26. Para  of the judgment.
- 27. a. b. Para  of the judgment.
- 28. Para  of the judgment.
- 29.  PCB 4, 226.
- 30. a. b. Para  of the judgment.
- 31. (2002) 5 ITELR 140.
- 32. Para  of the judgment.
- 33. Para  of the judgment.
- 34. Paras  –  of the judgment.
- 35. The practice in Guernsey is apparently to hear the full appeal on the basis that the likelihood of success is one factor which will determine whether leave should have been given.
- 36. John Martin QC presiding, Geoffrey Vos QC, and Clare Montgomery QC.
- 37. Paragraph  of the judgment.
- 38. Paragraph  of the judgment.
- 39. Paragraph  of the judgment.
- 40. Paragraph  of the judgment.
- 41. Paragraph  of the judgment.
- 42. Paragraph  of the judgment.
- 43. Paragraph  of the judgment.
- 44. Paragraph  of the judgment.
- 45. Paragraph  of the judgment.
- 46. Paragraph  of the judgment.
- 47. Paragraph  of the judgment.
- 48. Paragraph  of the judgment.
- 49. Paragraph  of the judgment.
- 50. See Allan v Rea Brothers Trustees Ltd  EWCA Civ 85 @ paras -, citing Re Abrahams  1 Ch 463 @ 485; See also Lewin on Trusts, 18th Edn, (Thomson/Sweet & Maxwell, 2007) para 29-249.
- 51. Re Slocock  1 All ER 358 @ 363.