Mourant Ozannes have issued an informative client briefing on Hastings-Bass.  The briefing is introduced as follows: It is with much sadness that we report the death in London on Wednesday, 9 March 2011 of Hastings-Bass, at the premature age of 36. In the years since its birth, Hastings-Bass had become a household name amongst, and highly popular with, trustees around the common law world. Hastings-Bass was done to death at the Court of Appeal in London by Lord Justice Lloyd, aided and abetted by Lords Justices Mummery and Longmore, following an appeal to them by HMRC, which had clearly been offended for some years by the increasing regularity with which Hastings-Bass had deprived it of much needed cash. The deadly deed occurred in the context of disputes involving HMRC: the first dispute was known as Pitt v Holt, and the second Futter v Futter. The Court of Appeal dealt with them together.

Many readers will be familiar with Hastings-Bass, or at least thought they were. It needs little introduction, but in short it was classically defined as follows:

“Where trustees act under a discretion given to them by the terms of the trust, in circumstances in which they are free to decide whether or not to exercise that discretion, but the effect of the exercise is different from that which they intended, the court will interfere with their action if it is clear that they would not have acted as they did had they not failed to take into account considerations which they ought to have taken into account, or taken into account considerations which they ought not to have taken into account.”

So how did this shocking tragedy occur? We need to look briefly at the two disputes which resulted in that fateful day in the Court of Appeal.

Read the briefing – click here

Mourant Ozannes