Title

Revisiting sham trusts: Common intention, estoppel and illegality

Publication Type

Journal Article

Publication Date

3-2018

Abstract

This article examines the prevailing view that, to find a sham trust, the settlor’s shamming intention must be shared by the trustee. This common intention requirement, it is argued, overprotects the trustee and the beneficiary, and suffers from inconsistent application to conceptually identical cases. Moreover, where the sham is concocted for the perpetuation of an illegal purpose, the requirement may contradict the operation of the illegality doctrine. This article proposes that the two doctrines ought to align and that any prejudice to an innocent trustee or beneficiary can be addressed with more specific solutions such as a change of position defence or an analogous estoppel defence.

Keywords

Sham Trusts, Illegality

Discipline

Commercial Law | Estates and Trusts

Research Areas

Private Law

Publication

Conveyancer and Property Lawyer

First Page

31

Last Page

44

ISSN

0010-8200

Publisher

Sweet and Maxwell

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