The High Court ordered that a clause in a deed of appointment from a trust to the settlor be set aside, following a mistake as to the capital gains tax effect of the appointment.
The trustees of a settlement sought an order from the High Court to correct a mistake made by the trustees in appointing to the settlor certain company shares.
The settlor executed a deed of appointment of settlement assets in the mistaken belief that the relevant shares would remain in the settlement, in order to avoid any capital gains tax (CGT) charge on them. However, the effect of a clause in the deed was to appoint the shares to him. This generated a CGT liability of approximately £650,000.
The professional trustee executed the appointment in the mistaken belief that earlier losses were available for CGT purposes to set against any gains on the shares appointed to the settlor, and that the appointment gave effect to
