Tuesday, April 19, 2016
Jacob C. Jorgensen (CIArd) recently published an article entitled, Sham Trusts. Provided below is an abstract of the article:
From a settlor’s point of view the major disadvantage of creating a trust is that he or she will have to transfer the legal ownership of and thus the control over the trust property to a trustee in order to enjoy the benefits, which a trust offers in relation to creditor protection, tax planning, estate planning, etc. It is therefore not surprising that most of the case law on sham trusts concerns how trustees and settlors have attempted to circumvent this fundamental legal requirement in the contractual relationship between them. This article by Jacob C. Jørgensen examines under which conditions a trust may be successfully challenged as a sham.