In Pitt v Holt [2010] EWCA Civ 197, the Court of
Appeal stated that the so-called rule in Hastings-Bass is not a
correct statement of the law. Where trustees purport to exercise a
discretionary power outside the scope of their power, the exercise
is void. If they act within the terms of their power, but they are
in breach of their fiduciary duties in respect of the exercise of
the power, for instance by not taking into account matters that
should have been taken into account (such as the tax consequences),
the exercise may be voidable by the court at the instance of a
beneficiary who is adversely affected.
1. INTRODUCTION
A. Background
The United Kingdom (UK) of Great Britain and Northern Ireland
contains three major legal jurisdictions: England and Wales,
Northern Ireland, and Scotland. England and Wales form one
jurisdiction; Wales has not had its own legal system distinct from
England since medieval times.
Information about the laws of trusts and estates is found in the
jurisdictional summaries of England & Wales, Ireland and
Scotland. Legal system, taxation and other matters (anti-money
laundering) relating to the UK are found in the UK summary.
The currency is the UK pound (GBP).
Clare Archer TEP
Penningtons LLP, London, England
Christopher Cooke TEP
Rooks Rider LLP, London, England
Simon Jennings TEP
Rawlinson & Hunter, London,
England
Sue Moore TEP
Sue Moore Tax, Leicester, England
Leigh Sagar TEP
New Square Chambers, London, England