| Abstract: | A settlement, created in 1994 by a UK resident for UK capitalgains tax purposes, was governed by British Virgin Island law.The trustees, in 2000, made two investments through a Guernseyprotected cell company. Before the second investment, the UKtax legislation changed. The trustees were not advised of thechange and the investment went ahead; this comprised £750,000paid by an investment company also controlled by the trustees,to the trustee, of which £712,000 was then paid as a loanto one of the cells of the Guernsey company. The unheeded changeof legislation resulted in a substantial tax liability for thesettlor. The trustee applied to the court for a declaration that thetrustee's decision to accept the |
