The High Court approved an amended scheme changing the terms of a trust linked to an insurance policy, finding that the arrangement would benefit M, who lacked capacity to assent. The judgment was delivered by Miss Justice Laffoy on 27 May 2011, after the application resumed on 6 May.
The application was brought by W on behalf of M under section 24 of the Land and Conveyancing Law Reform Act 2009. It concerned a declaration of trust made on 18 July 1997. The proposed changes addressed how the trust fund would pass if either C or D died before M. They provided for each person’s share to pass to that person’s legal personal representatives in that event.
The court had previously issued a preliminary judgment on 30 July 2010. After that decision, the plaintiff filed an amended summons and produced further affidavits. Irish Life also provided its file on the policy and trust. That file included a handwritten letter from M, dated 20 October 2004, saying she wished D and the plaintiff to benefit equally from the policy after her death.
B’s affidavit described a will M had made in January 2008, which reportedly left the residue of her estate to B and D. The will did not mention the policy, and M’s solicitors did not provide a copy or confirm its date. The judge said the court could not compel production of the will in the circumstances. On the evidence, the judge considered it probable that B, D and possibly A were the only people beneficially interested in the half of the trust fund that would otherwise become part of M’s estate. A, B and D had assented to the scheme.
The Revenue Commissioners told the court they would not argue that the application was substantially motivated by tax avoidance or reduction and would not oppose it. They indicated they might later seek their legal costs as a statutory notice party.
The court concluded that it was reasonable to treat M as the only other relevant person whose interests had to be considered under section 24(4). The judge found the evidence strongly indicated that M would have agreed to the scheme if she had capacity, and that the arrangement would therefore benefit her. The judge also said that, if D’s minor children were relevant persons, the changes would benefit them if D died before M.
The court approved the arrangement, but directed that the court order itself record the approval. It included a drafting clarification and excluded the proposed addition of the spouses of the settlors’ children to the class of possible beneficiaries. The judgment also said the court would address the appointment of new trustees under section 25 of the Trustee Act 1893. It does not state the resulting appointment order.