Unincorporated Associations: Property Holding, Charitable Purposes and Dissolution


 

Denning Law Journal 2014 Vol 26 pp 170-201 
 

REVISITING TRUSTEES’ DECISIONS: IS PITT V 
HOLT THE FINAL WORD ON THE RULE IN RE 

HASTINGS-BASS? 
 

Robert Pearce∗ 
 

INTRODUCTION 
 
Not every decision we make is a good one. The power to make decisions 

includes the power to make bad choices as well as good ones. Unless there is 
some other factor, such as the exercise of undue influence, the overbearing of 
will through duress, or a mistake, good and bad decisions are equally 
enforceable in law.1 It might be thought that the same rule applies to decisions 
made by trustees, even though their decisions generally relate to the interests 
of the beneficiaries, rather than to their own interests. Of course, if the 
decision is so bad that it amounts to a breach of trust, and loss is thereby 
caused to the trust fund, then the breach might expose the trustees to liability 
to the beneficiaries.  

It was against this background that what became known as the rule in Re 
Hastings-Bass achieved prominence. A series of first instance decisions 
permitted trustees in some instances to backtrack on a decision which had 
unintended effects or consequences. The rule became subject to criticism, and 
was reviewed by the Supreme Court in Futter v HMRC on appeal from Pitt v 
Holt in the Court of Appeal.2 The decision of the Supreme Court substantially 
limits the scope of the rule, and identifies three circumstances where the 

∗ Professor Robert Pearce, BCL, MA, Hon LLD, FRSA, Professor in Law, the 
University of Buckingham. 
1 See for instance Mulitiservice Bookbinding Ltd v Marden [1979] Ch 84 where a 
businessman made the financially very expensive decision to take out a loan at a high 
rate of interest with repayments linked to the value of the Swiss Franc, in effect 
accepting a “double whammy” of two different ways of reflecting the relatively weak 
position of sterling. Even though the bargain was manifestly disadvantageous to the 
businessman, the court enforced it because there were no vitiating factors.  
2 The Court of Appeal in Pitt v Holt [2011] EWCA Civ 197 heard conjoined appeals 
from Pitt v Holt [2010] EWHC 45 (Ch) and Futter v Futter [2010] EWHC 449 (Ch). 
The trustees in both cases appealed to the Supreme Court which heard a conjoined 
appeal. Although the whole litigation is often cited as Pitt v Holt, for convenience this 
article refers to the Court of Appeal decision as Pitt v Holt [2011] EWCA Civ 197 
and the Supreme Court decision as Futter v HMRC [2013] UKSC 26 . 

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decisions of trustees can be reversed: namely where there has been an 
operative mistake; excessive execution; or inadequate deliberation.  

This article explores the three dimensions to the rule in Re Hastings-Bass 
and identifies a number of difficulties with the decision in Futter v HMRC.  

 
BACKGROUND 

 
The Hastings-Bass rule 

 
The rule in Re Hastings-Bass was heavily used and was described as a 

“get out of jail free card” or a “magic morning-after pill” because of its utility 
in reversing the effect of a decision by trustees which had an unintended and 
undesirable consequence, frequently unforeseen tax liability.3 The rule was 
most authoritatively described by Lloyd LJ in Sieff v Fox4, the last case he 
heard as a High Court judge, with judgment delivered only after his elevation 
to the Court of Appeal: 

"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." 

Although Re Hastings-Bass5 was first reported in 1974, it was not until 
the early 21st century that the rule carrying the name of that case achieved 
attention. As Longmore LJ observed in Pitt v Holt, Snell on Equity did not 
contain any substantial discussion of Re Hastings-Bass until a supplement 
issued between the 30th and 31st editions in 2000 and 2005, and other 
textbooks show a similar pattern.6 Until the conjoined appeals in Pitt v Holt 

3 See Lord Neuberger, “Aspects of the law of mistake: Re Hastings-Bass,” Lecture to 
the Chancery Bar Association Conference in London on 16 January 2009, (2009) 
15(4) Trusts & Trustees 189–99. 
4 Sieff v Fox[2005] 1 WLR 3811. 
5Re Hastings Bass[1975] Ch 25. 
6 For instance, there is no reference to Re Hastings-Bass in Hudson's Equity and 
Trusts second edition in 2001, nor in Delany's Equity and the Law of Trusts in Ireland 
in 1996. There is no reference to Re Hastings-Bass in the first edition of Pearce and 
Stevens, The Law of Trusts and Equitable Obligations in 1995. It was only in the 
second edition in 1998 that Re Hastings-Bass made its first appearance. That 
appearance was driven by a reference to the then very recently reported case of Scott v 
National Trust, the case in which the National Trust’s decision to ban stag hunting 

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and Futter v Futter all of the cases considering the rule had been at first 
instance, and there were some problems concerning the scope and effect of 
the rule. There was some uncertainty as to whether there had to be a breach of 
trust before the rule could be invoked. It was also unclear whether, when the 
rule applied, the impugned decision of the trustees was void or merely 
voidable. Lloyd LJ was therefore not alone in suggesting in Sieff v Fox that a 
review by the Court of Appeal was desirable. As it happened, he was able to 
undertake the review himself in Pitt v Holt. The decision of the Court of 
Appeal was appealed to the Supreme Court, which has given what is widely 
perceived as putting the rule in Re Hastings-Bass on a short leash. As will be 
seen, it is too early to say that the rule has been fully brought to heel.  

 
The history of the cases 

 
The decision of the Supreme Court in Futter v HMRC has been explained 

and analysed by Miguel Colebrook in last year’s Denning Law Journal,7 so 
only a brief resumé of the case is needed. In one of the two conjoined appeals, 
Pitt v Holt, a settlement by way of a discretionary trust had been established 
with the funds received by a seriously injured road accident victim. Owing to 
incorrect tax advice, inheritance tax charges would absorb a significant 
proportion of the funds on his death; if differently structured, the settlement 
could have avoided those charges. In Futter v Futter advancements to 
beneficiaries had been made by the trustees which it was thought, on the basis 
of incorrect advice, would not incur a capital gains tax charge because they 
could be set off against other losses. The trustees in both cases sought to have 
the transactions set aside using the rule in Re Hastings-Bass. The trustees in 
Pitt v Holt also argued that the settlement could be set aside on the grounds of 
mistake. 

The trustees’ applications were successful in the High Court, but were 
rejected by the Court of Appeal. The Supreme Court, in a judgment given by 
Lord Walker with which the other Supreme Court Justices agreed, affirmed 
the decisions of the Court of Appeal on the interpretation and application of 
the rule in Re Hastings-Bass, although it differed from the Court of Appeal in 
relation to the issue of mistake in Pitt v Holt, and on this ground only, allowed 
the appeal. 

The Supreme Court identified three routes by which discretionary 
decisions of trustees can be challenged. The first is what the court described 

was challenged. The third edition of Moffat, Trusts Law Text and Materials, 
published in 1999, contains a very short reference, but no discussion. 
7 Miguel Colebrook, "Get out of jail free" card: the courts' offer of assistance to 
errant trustees” [2013] Denning LJ 211-223. 

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as excessive execution, the second inadequate deliberation,8 and the third 
mistake. The first two are branches of the new rule in Re Hastings-Bass. The 
third is a separate rule. It is convenient to begin with mistake.  

 
MISTAKE 

 
The statement of the rule 

 
In many cases where it is desired to set aside a decision of trustees, a 

mistake will have been made. In both Pitt v Holt and in Futter v Futter the 
trustees were acting under a mistake about the tax consequences of their 
decision, but it was only in the former case that the mistake had been pleaded 
as a basis for reversing the decision. The Court of Appeal had rejected the 
claim on the basis that rescission was possible only where a mistake related to 
the legal effects of a decision or as to an existing fact basic to the transaction, 
and not where the mistake related to the consequences of a decision. The view 
of the Supreme Court was that voluntary dispositions could be set aside 
whenever a mistake made it objectively unconscionable or unjust to leave the 
mistake uncorrected having regard to “its degree of centrality to the 
transaction in question and the seriousness of its consequences”.9 This test 
was satisfied in the circumstances of Pitt v Holt, but since the point had not 
been raised in the claim there was no need to consider the test in Futter v 
Futter. The decision of the Supreme Court on the issue of mistake is 
applicable not only to decisions of trustees, but also to other gratuitous 
dispositions. 

 
The relevance of taxation 

 
The Supreme Court took the view that a mistake about the tax 

consequences of a decision could be a relevant consideration, and this is 
demonstrated by the view it took of the quality of the mistake in Pitt v Holt. 
However, the Court indicated that: 

  
“Had mistake been raised in Futter there would have been an issue of 
some importance as to whether the Court should assist in extricating 
claimants from a tax-avoidance scheme which had gone wrong.... In 

8 Futter v HMRC [2013] UKSC 26 at [60]. These labels for the two branches of the 
rule were not used by the Court of Appeal. 
9 Ibid at [128]. The Jersey courts have independently reached a similar conclusion 
about the test for mistake: Re Representation R, re S Trust [2011] JRC 117; CC Ltd v 
Apex Trust Ltd [2012] JRC 071; Re B [2012] JRC 229. 

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some cases of artificial tax avoidance the court might think it right to 
refuse relief, either on the ground that such claimants, acting on 
supposedly expert advice, must be taken to have accepted the risk that 
the scheme would prove ineffective, or on the ground that 
discretionary relief should be refused on grounds of public policy. 
Since the seminal decision of the House of Lords in WT Ramsay Ltd v 
IRC 10 there has been an increasingly strong and general recognition 
that artificial tax avoidance is a social evil which puts an unfair burden 
on the shoulders of those who do not adopt such measures.”11 

 
These remarks about tax avoidance are revealing. It may be true that there 

is some resentment amongst most taxpayers that the rich are able to adopt tax 
avoidance measures, which reduce the incidence of taxation, which they 
would otherwise incur (a resentment which almost certainly predated the 
Ramsay decision). What is more important is that the Court has signalled a 
reluctance to assist in the implementation of these schemes. A light touch on 
the tiller can be enough to change the direction of even the largest vessel. This 
was evident in the impact of Lord Neuberger’s report on superinjunctions.12 
In the same way Lord Walker’s remarks may have been intended to, and are 
likely to have, the effect of discouraging applications to escape from tax 
avoidance schemes, which have gone wrong.  

 
Uncertainty about the criteria 

 
The clear statement of principle in relation to mistake is welcome since it 

resolves some of the problems in making sense of the old authorities.13 
However, there is only very limited guidance on how the principle should be 
applied. The emphasis on ascertaining what is unjust, unfair or 
unconscionable14 in all the circumstances is uncomfortably reminiscent of the 
discredited notion of the “new model constructive trust” articulated by Lord 
Denning in Hussey v Palmer15 where he suggested that a constructive trust 
could arise to give a spouse an interest in the family home owned by the other 
spouse “whenever justice and good conscience require it.” However, the 
assertion of a broad discretion chimes with the approach of the Supreme Court 

10 WT Ramsay Ltd v IRC [1982] AC 300. 
11 Futter v HMRC [2013] UKSC 26 at [135]. 
12 Robert Pearce. “Privacy, Superinjunctions and Anonymity, ‘Selling my story will 
sort my life out’” (2011) 23 Denning LJ 92-130 
13 See Futter v HMRC [2013] UKSC 26at [4]. 
14 Ibid at [126] 
15 Hussey v Palmer [1972] 1 WLR 1286. 

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in the Fen Tigers case16 to the use of injunctions to restrain a nuisance and it 
also echoes the language used in the different context of Stack v Dowden17 
and Jones v Kernott18 for ascertaining shares in a family home purchased in 
joint names. Richard Nolan, writing in the Law Quarterly Review,19 argues 
that the uncertainty implicit in the use of the open-ended criterion of 
unconscionability should not be overstated, and that the concept should not be 
inherently more difficult to implement than the widely used criterion of 
reasonableness.  

One of the questions which will arise is how far the courts can provide 
guidance on what factors are relevant to ascertaining when an injustice would 
arise from leaving a mistaken decision uncorrected. Lord Walker believed that 
"the court cannot decide the issue of what is unconscionable by an elaborate 
set of rules”20 but by contrast, Lord Neuberger, in the Fen Tigers case, said 
that the existence of a broad discretion “does not prevent the courts from 
laying down rules as to what factors can, and cannot, be taken into account by 
a judge when deciding whether to exercise his discretion”.21 Lord Clarke in 
the same case also referred to the development of a set of principles to be 
developed on a case-by-case basis.22 

 
Unjust or unfair to whom? 

 
Lloyd LJ in the Court of Appeal concluded, on his review of the 

authorities, that a dispositive decision of trustees could only be set aside on 
the basis of mistake where it would be unconscionable for the recipient23 to 
retain the benefit. The problem with making the recipient the focus is that, 
although on occasions the recipient will be aware of the mistake, it is possible 
for the recipient to be completely ignorant of the misapprehension under 
which the donor was acting.24 The more general focus of the Supreme Court 
on whether it would be objectively unconscionable to leave a mistake 
uncorrected, and the explicit recognition that the mistake jurisdiction applies 

16 Coventry v Lawrence [2014] UKSC 13 at [117]-[123] 
17 Stack v Dowden [2007] UKHL 17 
18 [2011] UKSC 53 
19 Nolan, “Fiduciaries and their flawed decisions” LQR 2013, 129(Oct), 469-473 
20 Futter v HMRC [2013] UKSC 26 at [128].  
21 Coventry v Lawrence [2014] UKSC 13 at [121]. 
22 Ibid at [171]. 
23 Pitt v Holt [2011] EWCA Civ 197 at [203] and [210]. 
24 In Day v Day [2013] EWCA Civ 280, decided by the Court of Appeal between the 
Court of Appeal and Supreme Court decisions in Pitt v Holt a voluntary conveyance 
was set aside on the footing of unilateral mistake, but there was strong evidence that 
the recipient at the very least knew of the mistake and might have contributed to it. 

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to unilateral mistakes, is therefore appropriate. The effect may be that the 
protection of the recipient is less explicit, but any prejudice to the recipient 
must surely be a factor in deciding whether justice requires a mistake to be 
corrected, and also for deciding the terms upon which any relief can be given. 
Similar account can be taken of the impact upon third parties.  
 
Operative mistake  

 
Lord Walker was very clear that the jurisdiction to reverse a decision 

made on the basis of a mistake applied only where there had been an operative 
mistake as opposed to disappointed expectations or total ignorance. It was 
therefore important in Pitt v Holt that the tax implications of the settlement 
had been considered; had no consideration to taxation been given at all, it 
could not have been argued that the decision to create the settlement was 
mistaken even if the tax consequences might have proved disastrous. This 
may seem harsh, but where such a decision is made by trustees in ignorance 
the rule(s) in Re Hastings-Bass might offer an alternative route to a remedy. 

The remarks which Lord Walker made about the acceptance of a known 
risk not constituting a mistake are illustrated, although not in the context of 
tax avoidance, by HSH Nordbank AG v Intesa Sanpaolo SpA.25 An Italian 
local authority had entered into an interest rate swap agreement with the 
defendant bank which was later replaced by another interest rate swap 
agreement with the claimant bank. The claimant bank’s agreement was held 
by the Italian Court of Auditors to be beyond the local authority’s powers. 
The claimant bank sought to recover its position by claiming that the earlier 
interest rate swap agreement between the local authority and the defendant 
bank was also beyond the local authority’s powers, that the claimant bank had 
entered into the novation agreement to replace it under the influence of an 
operative mistake, and that it was therefore entitled to restitution from the 
defendant bank. The claimant bank failed to establish that the earlier interest 
rate swap agreement was void as beyond the local authority’s powers, but 
Burton J held that, even if it had succeeded on this point, there was no 
mistake. The claimant bank’s official was aware that not all interest rate swap 
agreements made by Italian local authorities were permitted by law,26 and “he 
was not troubled by any such risk and accepted it.”27  

The lack of an operative mistake was also fatal in Spaul v Spaul,28 a case 
decided by the Court of Appeal after Futter v HMRC. A company director in 

25 HSN Nordbank AG v Intesa Sanpaolo SPA[2014] EWHC 142 (Comm). 
26 Ibid at [50].  
27 Ibid n 25 at [51]. 
28 [2014] EWCA Civ 679. 

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breach of duty appropriated property owned by the company in what the court 
considered amounted to theft. He subsequently transferred his shares in the 
company to his brother (the only other shareholder). When the director was 
required to make restitution to the company for his misappropriation, he 
claimed that the share transfer should be set aside on grounds of mistake. The 
Court of Appeal decided that there was no basis for holding that there had 
been any mistake: the share transfer had been intended by the director to make 
good his wrongdoing at a time when the shares were practically worthless, 
and that intention was not invalidated by the shares subsequently becoming 
more valuable. 

A similar decision is Pagel v Farman.29 This case involved former 
business partners in an investment business. Farman was responsible for 
choosing the investments, and Pagel for marketing. The business was initially 
successful, but later generated losses. In order to meet a tax bill, Pagel asked 
Farman for a substantial gift as a goodwill gesture, and Farman gave him 
shares worth £3.8 million. When Pagel later sued to recover the losses, which 
he believed he had suffered through Farman’s poor investment strategy, 
Farman counterclaimed for the return of the gift. The judge rejected the claim 
that the gift had been made because Farman mistakenly thought that Pagel 
was in financial difficulties. Farman was likely to know that this was not the 
case. Instead, the gift had more likely been made by Farman to acknowledge 
his responsibility for the losses which the partnership had suffered. No 
operative mistake was therefore proved. 

 
Can oversight be a mistake? 

 
Trustees who fail to take account of a material consideration are likely to 

be in breach of trust, and beneficiaries may be able to invoke the inadequate 
consideration branch of the rule in Re Hastings-Bass, discussed below. But 
would this situation also constitute a mistake? In Re Strathmullan Trust30 an 
offshore trust was established in 1997 with the objective of reducing liability 
to inheritance tax. Unfortunately no consideration was given to the UK’s 
deemed domicile provisions, which meant that the trust would not avoid 
inheritance tax. This problem was identified in 2010. The Jersey Royal Court, 
finding that the decision in Futter v HMRC “seems to us broadly to align the 
approach to be taken by the English courts in the future with that adopted by 
the Royal Court”31 held that there was an operative mistake on the part of the 
settlor which justified setting the trust aside. The basis of the mistake was that 

29 Pagel v Farman [2013] EWHC 2210 (Comm). 
30 Re Strathmullan Trust [2014] JRC 056. 
31 Ibid at [20]. 

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“that one material factor was overlooked”.32 By contrast, Lord Walker in 
Futter v HMRC held that “causative ignorance” would be insufficient to 
justify relief for mistake. In his view, “If someone does not apply his mind to 
a point at all, it is difficult to say that there has been some real mistake about 
it.”33 This view makes it critically important as to how an oversight is viewed. 
In the Strathmullan case, the facts could be interpreted either as a failure to 
consider deemed domicile (which was not thought about at all), or as a 
mistake about the incidence of inheritance tax (which was very much in 
mind). Similarly, Mrs Pitt either failed to consider inheritance tax or was 
mistaken in her view that there would be no adverse tax consequences of 
setting up the trust in the form adopted (the Supreme Court accepted the latter 
interpretation). Lord Walker dismissed the suggestion that drawing the 
boundary between these different categorisations of the same actions would 
be subject to judicial manipulation (a description he thought a bit harsh),34 but 
it is hard to avoid the conclusion that this dimension adds additional 
uncertainty to the application of the criteria for relief.  

 
THE (NEW) RULE(S) IN RE HASTINGS-BASS 

 
The main issue in Pitt v Holt was the rule in Re Hastings-Bass. The 

Supreme Court agreed with the Court of Appeal that the rule had been both 
misattributed and misunderstood. Although there were dicta in Re Hastings-
Bass which supported the rule, the genesis of the rule could more fairly be 
attributed to Mettoy Pension Trustees v Evans.35 The correct position was also 
that there were two rules. Lord Walker, delivering a judgment with which all 
the other members of the Supreme Court agreed, considered that Lloyd LJ had 
been correct to make “the very important distinction between an error by 
trustees in going beyond the scope of a power” (“excessive execution”) and 
“an error in failing to give proper consideration to relevant matters in making 
a decision which is within the scope of the relevant power” (“inadequate 
deliberation”).36 Because there was no issue of excessive execution, he 
directed his subsequent remarks to situations involving inadequate 
deliberation. He agreed with Lloyd LJ that where trustees were in breach of 
fiduciary duty in exercising a dispositive power through failing to take into 
account a relevant matter, or through bringing into account an irrelevant 

32 Ibid n 30 at [40]. 
33 Futter v HMRC [2013] UKSC 26 at [108]. 
34 Ibid at [127]. 
35 Mettoy Pension Trustees v Evans[1990] 1 WLR 1587. 
36 Ibid at [60]. 

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matter, then their decision would be voidable “at the suit of a beneficiary, but 
this would be subject to equitable defences and to the court’s discretion.”  

 
EXCESSIVE EXECUTION 

 
The ambit of the rule 

 
Although the Supreme Court described one branch of the redefined rule in 

Re Hastings-Bass as “excessive execution”, this description does not fully 
capture its potential ambit. Whenever trustees do something which is beyond 
their powers their action cannot be effective precisely because they have no 
power to do it. Lloyd LJ in the Court of Appeal helpfully identified a number 
of ways in which an action can be beyond the powers of trustees and will 
therefore be void.37 

 
(i) Procedural defects 

 
Trustees may act beyond their powers through “the use of the wrong kind 

of document or the failure to obtain a necessary prior consent.” Re Gleeds 
Retirement Benefits Scheme,38 decided after Futter v HMRC, is a perfect 
example. Pension trustees had purported to make a number of decisions about 
pension increases, the appointment of new trustees and other matters. The 
decisions were not actioned by deed as required by the terms of the trust, but 
by documents which did not constitute deeds through a failure to have them 
properly witnessed. Newey J held that the documents were wholly 
ineffective.39  

 
(ii) Substantive defects 

 
Lloyd LJ said that “There may be a substantive defect, such as an 

unauthorised delegation or an appointment to someone who is not within the 
class of objects.” This again is illustrated by Re Gleeds Retirement Benefits 

37 Pitt v Holt [2011] EWCA Civ 197 at [96]. 
38 Briggs v Gleeds (Head Office) [2014] EWHC 1178 (Ch). 
39 A different result would probably have been reached under Jersey law, since it has 
been held by the Jersey Royal Court in Re the Shinorvic Trust [2012] JRC 081 that, 
subject to a number of conditions which would have been satisfied in the Gleeds case, 
equity will correct a formal defect in the execution of a power. See also Marley v 
Rawlings [2014] UKSC 2 for a more benign approach to a defect in the execution of a 
will. 

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Scheme.40 The pension trust was restricted to qualified chartered surveyors, 
but the trustees purported to allow other employees to join the scheme 
following an ineffective attempt to widen eligibility for membership by an 
invalidly executed document. Newey J held that “anyone purportedly 
admitted to membership on or after that date who was not a chartered quantity 
surveyor will not have accrued any benefits under the Scheme as a 
member.”41 

 
(iii) Fraud on a power 

 
Lloyd LJ considered that “cases of a fraud on the power are similar to the 

latter [appointment to someone who is not within the class of object], since 
the true intended beneficiary, who is not an object of the power, is someone 
other than the nominal appointee.” 

 
(iv) Powers of advancement  

 
Statutory and express powers of appointment can be used only to confer a 

benefit on the appointee. If no benefit is conferred, then the purported exercise 
of the power will be void. 

 
(v) Other legal defects  

 
Lloyd LJ indicated that “There may also be a defect under the general law, 

such as the rule against perpetuities, whose impact and significance will 
depend on the extent of the invalidity.” In making this remark he had in mind 
cases where the effect of the rule against perpetuities might be to deprive the 
object of a power of appointment of the benefit intended to be conferred by a 
decision. “In that case the advancement will be void, since the power can only 
be used for the benefit of the relevant person and the purported exercise was 
not for his or her benefit.” 

 
A grouping of disparate situations 

 
The grouping together of this range of situations in which trustees can be 

considered to have acted beyond their powers has some implications which 
have yet to be explored or explained. First, Lloyd LJ has conflated a number 
of different situations in a way which may not have been sufficiently 
discriminating. This is demonstrated by the label attached by Lord Walker. It 

40 Gleeds Retirement Benefits Scheme [2014] EWHC 1178 (Ch). 
41 Re Gleeds Retirement Benefits Scheme [2014] EWHC 1178 (Ch) at [189]. 

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is somewhat strange to describe the defective execution of a deed or the 
breach of some other general provision of the law such as a failure to comply 
with the rule against perpetuities as “excessive execution”. There is a danger 
that the grouping means that every situation in the list will be treated 
similarly. This should not be the case. 

 
Is there always a breach of trust? 

 
The consequences which flow from the different types of acting beyond 

the scope of a power enumerated by Lloyd LJ are not always identical. There 
may be a difference between the treatment of a trustee who acts outside the 
terms of the trust and a trustee who fails to comply with some provisions of 
the general law. A trustee who acts outside the scope of his powers (for 
instance by making a disposition in favour of a person who is not within the 
class of potential beneficiaries) commits a breach of trust. There is an absolute 
obligation on trustees to act within their powers42, such that taking all due 
care does not avoid liability43, although it may be a factor in justifying a court 
in granting relief on the basis that the trustee had acted “honestly and 
reasonably and ought fairly to be excused.”44 Lord Walker thought that there 
might be cases where trustees are in breach of trust without exceeding their 
powers “even if they have obtained apparently competent professional advice, 
if they act ... contrary to the general law”.45 The example he gave, however, 
was of an Australian case46 in which the incorrect advice was as to the 
interpretation of the intestacy laws. That was not, therefore, a case of doing 
something which was in breach of the general law, but as Lloyd LJ in the 
Court of Appeal correctly recognised, of the trustees acting outside the scope 
of their powers by making a payment to a person who was not within the class 
of beneficiaries.47  

By way of contrast, some of the situations in which trustees’ actions are 
ineffective because of a failure to comply with the general law may not 
constitute a breach of trust. For instance, it may not be a breach of trust if 

42 As is explicitly recognised in Pitt v Holt by Mummery LJ at [237]. 
43 See Pitt v Holt [2011] EWCA Civ 197 at [122] where Lloyd LJ draws a distinction 
between making the advancement in Re Abrahams’ Will Trust [1969] 1 Ch 463 
(which he said would not be a breach of trust because the trustees acted reasonably in 
the light of the state of knowledge at the time they made their decision) and acting on 
the decision by paying the wrong beneficiary, which would be a breach of trust. 
44 Trustee Act 1925 s. 61. 
45 Futter v HMRC [2013] UKSC 26 at [80]. 
46 National Trustees Co of Australasia Ltd v General Finance Co of Australasia Ltd 
[1905] AC 373. 
47 Pitt v Holt [2011] EWCA Civ 197 at [121]. 

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unremunerated lay trustees who have properly made a decision which is 
within their powers then fail to execute it correctly in accordance with the 
general law because they reasonably follow48 inadequate or incorrect advice 
from their properly qualified, properly selected and properly appointed 
advisers.49 Such action is not beyond their powers, it is merely ineffective.  

 
Consent of beneficiaries 

 
Another difference is that in those cases where the general law (rather 

than the terms of the trust) prohibit an act by the trustees, the consent of the 
beneficiaries affected will normally be irrelevant to the prohibition. 
Conversely, in those instances where there is an act which is outside the scope 
of the power because it is not authorised by the terms of the trust, the consent 
of all of the beneficiaries affected is capable of exonerating the trustees from 
liability for breach of trust50 or even of authorising an act which would 
otherwise be unauthorised.51  

 
Is the invalidity automatic? 

 
The main factor which unites the categories enumerated by Lloyd LJ is 

that they are instances where the action or decision of the trustees is void. One 
of the characteristics of a void decision is that it does not in principle require a 
declaratory decision of the court to make or confirm its invalidity: an order of 
the court simply serves to declare the position as it already is. A failure 
properly to execute a document will be ineffective even without a judgment to 
that effect by a court: for instance it does not require a decision of the court to 
permit the Land Registry to reject a transfer of land by trustees which has not 
been made by deed. However, there are some instances in the list set out by 
Lloyd LJ where an evaluative consideration may be required. This can be true 
both as to whether an advancement confers sufficient benefit on an advancee 
(category (iv) above) and as to whether the exercise of a power constitutes a 

48 In Dunn v Flood (1885) 28 Ch D 586, an example given by Lord Walker of trustees 
not being protected by following professional advice from breach of trust for 
excessive execution, the trustees were in breach for two reasons: the imposition of 
depreciatory conditions on a sale of trust property was beyond their powers, and they 
unreasonably decided to follow the advice they received, so they were also in breach 
of trust for their failure to act with reasonable care. 
49 This was not discussed in Briggs v Gleeds (Head Office) [2014] EWHC 1178 (Ch).  
50 Re Pauling’s Settlement Trusts [1964] Ch 303. 
51 Saunders v Vautier (1841) Cr & Ph 240; Peter Luxton, ‘Variation of Trusts: 
Settlors’ Intentions and the Consent Principle in Saunders v Vautier’ (1997) 60 MLR 
719. 

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fraud in the sense that it confers benefits on parties who are not within the 
scope of the power (category (iii) above). In such cases it may be much less 
apparent to a third party that a decision has been made in excess of trustees’ 
powers than it is with (say) an invalidly executed deed (where the invalidity 
may be obvious on the face), and there may be scope for argument about 
whether the decision has properly been made. The difficulty of establishing 
whether an advancement has been properly made is compounded by the 
recognition in cases in which the court has approved advancements that the 
benefit does not require financial gain to the beneficiary concerned: making a 
gift to charity will confer a benefit on the beneficiary if it meets a moral 
obligation.52 Regard to cases involving variations of trust make the decision 
even more difficult, for in this context the chance of benefit has been treated 
as sufficient to justify the court giving consent, even if there may be 
circumstances in which the benefit may be lost entirely. A court order may 
therefore be necessary to resolve the issue of whether an advancement has 
properly been made. In such circumstances there is less logic in concluding 
that the action of the trustees in making what purports to be an advancement is 
void, and the same applies to dispositions, on their face within the powers of 
trustees, which are challenged as having been made in fraud of the power. 
Both the Court of Appeal and the Supreme Court had some reservations about 
holding that a decision of trustees which was in fraud of a power is void, 
rather than merely voidable, although there is Court of Appeal authority to 
this effect. Lloyd LJ made the case for this issue being revisited, and the need 
for this was endorsed in the Supreme Court.53 

 
Ambulatory invalidity 

 
Another question affecting decisions outside the scope of trustees’ powers 

relates to what may be termed “ambulatory invalidity”. Lloyd LJ in Pitt v 
Holt54 appears to contemplate that where an advancement has been made 
which is believed to confer a benefit on a beneficiary as the law is then 
understood, but the beneficiary is later shorn of that benefit because of a 
change in the interpretation of the relevant law, the advancement will be void 
because of the absence of benefit, which is a precondition of a valid 
advancement. This is illustrated by Re Abrahams’ Will Trusts which involved 
a trust established in 1948. Advancements purported to be made in 1957 were 
held to be void. We understand from the analysis in Pitt v Holt and Re 
Hastings-Bass that this was because the advancements did not in fact confer 

52 Re Clore’s Settlement Trusts [1966] 1 WLR 955. 
53 Futter v HMRC [2013] UKSC 26 at [62]. 
54 Pitt v Holt [2011] EWCA Civ 197 at [122]. 

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any benefit on the advancee. But why was this? It was because, although the 
trustees honestly and reasonably believed that a new perpetuity period would 
apply to the advancements, they were wrong. In 1962, several years after the 
purported advancement, the House of Lords held in Pilkington v IRC that in 
circumstances like these, the advancement had to be written back into the 
original settlement. Now, of course, the common law fiction is that the House 
of Lords declares the law as it always has been, so it could be argued that 
even in 1957 the advancement did not in fact confer the benefits it was 
thought that it did. However, if you had asked the trustees in 1957, the 
received opinion then was that the arrangement they had made did constitute a 
valid advancement, and it would have needed unusual powers of prescience to 
forecast that the House of Lords would decide otherwise.55 Similarly, in Re 
Hastings-Bass legal advice was taken before making the advancement, yet 
Buckley LJ in that case was still prepared to analyse whether there was a 
benefit in the light of the “change” made by Pilkington. During the interval 
between the purported advancement and the decision in Pilkington, everyone 
concerned would have believed that the advancement conferred a benefit (and 
they may have had advice to this effect); it was only following Pilkington that 
there can have been an appreciation that the position had changed. It is hard to 
reach any conclusion other than that a change in the interpretation of the rule 
against perpetuities can invalidate what was previously thought to be a valid 
exercise of discretion by taking the decision of trustees beyond their powers. 
If that is so, then why would not a change in the interpretation of the tax laws, 
or even a legislative change to the tax laws have the capacity to strip the 
anticipated benefit from an advancee and thereby invalidate the decision? 

 
INADEQUATE DELIBERATION  

 
The elements of the rule 

 
The key points which Lord Walker identified in relation to inadequate 

deliberation are that the failure by the trustees must be sufficiently grave to 
amount to a breach of fiduciary duty;56 and that it would be wrong to hold 
trustees responsible for inadequate deliberation where they have sought and 
relied upon apparently competent professional advice.57 Importantly, Lord 
Walker made it clear that trustees are not under a duty to be right on every 

55 See Pitt v Holt [2011] EWCA Civ 197 at [51]. 
56 Ibid at [68] and [73] (Lord Walker repeats the same phrase). 
57 Ibid n 55 at [80]. 

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occasion.58 The effect of inadequate deliberation is that a decision is only 
voidable, not void. 

 
Breach of trust the basis? 

 
Both the Court of Appeal and the Supreme Court place considerable 

emphasis on inadequate deliberation justifying undoing a decision because it 
constitutes a breach of fiduciary duty, and therefore a breach of trust. A key 
part of the reasoning is that unless there is a breach of trust, and in the absence 
of an operative mistake, there is no justification for setting aside a decision of 
the trustees. Since there is invariably a breach of trust in cases of excessive 
execution where trustees genuinely act beyond the powers conferred by the 
trust (rather than failing to comply with a requirement of the general law), it 
might therefore appear that breach of trust is the general justification for 
invalidating the decisions of trustees. If this is the case, then there is a very 
real issue as to where and why the dividing line between void and voidable 
decisions should be drawn. The Supreme Court did not consider it necessary 
to consider the justification for the point at which it drew the line between 
void and voidable acts, given a concession by counsel on both sides.59 The 
Court of Appeal gave little consideration to the issue despite the difference of 
opinion in earlier cases. The reasoning appears to be that the situations in 
which a decision will be void should be kept to a minimum60 and that by 
analogy with the self-dealing rule, transactions in breach of fiduciary duty are 
voidable not void.61 If the basis for the jurisdiction is breach of fiduciary duty 
rather than simply breach of trust, then we will see that there is a serious 
problem. 

  
Categorisation of breaches of trust 

 
The duties of trustees fall into three broad groups. First, there are absolute 

duties, principally the duty to act within the terms of the trust. Secondly, there 
are situations in which trustees have obligations of diligence, prudence, or 
reasonable care. Finally, trustees have fiduciary duties. Lord Walker, 
following Lloyd LJ in the Court of Appeal, ostensibly confines the inadequate 
deliberation rule to the final category.  

58 Ibid n 55 at [88]. 
59 Futter v HMRC [2013] UKSC 26at [93]. 
60 See Pitt v Holt [2011] EWCA Civ 197 at [101]. 
61 See Lloyd LJ in Pitt v Holt [2011] EWCA Civ 197 at [100] citing Gwembe Valley 
Development Co Ltd v Koshy [2003] EWCA Civ 1048. 

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The first category corresponds with the “scope of the power” or the “four 
corners of the trust” test. There is a breach if the trustee acts beyond the scope 
of authority conferred by the trust, for instance by failing to follow binding 
instructions, by paying the wrong beneficiary, by disposing of inalienable 
property, by acting without a necessary consent, and the like. Even where a 
trustee seeks advice and acts upon it, the duty can be broken, for it is not 
dependent upon fault in the sense of negligence or lack of care. This is why, 
in National Trustees Co of Australasia Ltd v General Finance Co of 
Australasia Ltd 62 trustees who followed advice about who were their 
beneficiaries were liable when their advisers “by some extraordinary slip” 
misinterpreted the statutory intestacy rules.  

The second category of duty applies where by statute or the rules of 
equity, trustees are required to act with reasonable care, or the old equitable 
equivalent, the duty to act as a prudent man of business would in dealing with 
the affairs of others. A list of circumstances in which there is a duty to take 
reasonable care is set out in the Trustee Act 2000, Schedule 1. This includes a 
number of activities including the exercise of investment powers, and the 
selection and supervision of agents. A similar common law duty under the 
rule in Speight v Gaunt applies to most aspects of trustees’ other 
responsibilities. 

The final category comprises those duties which are fiduciary in nature. 
As is frequently pointed out, the essence of a fiduciary duty is that it is a duty 
to demonstrate loyalty, and this is why it applies not just to trustees but also to 
others such as agents or company directors who have assumed roles in which 
this kind of responsibility is inherent. The duties of loyalty applied to 
fiduciaries include: 

 
i. The duty to act in good faith;  

ii. The duty not to make a personal profit; 
iii. The duty to avoid any conflict of interest; 
iv. The duty not to act for one’s own benefit or for the benefit of a 

third party without informed consent. 
 
In addition, it is apt to describe as fiduciary duties the obligation of 

trustees to ascertain the true wishes of the settlor in order to give effect to the 

62 National Trustees Co of Australasia Ltd. v General Finance Co of Australasia 
Ltd.[1905] AC 373. 

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settlor’s instructions,63 and the obligation of trustees to hold a fair balance 
between beneficiaries.64  

 
Common slips concerning fiduciary duties 

 
It is easy to make one of several slips when considering fiduciary duties. 

The first is to think that all the duties owed by a fiduciary fall into the same 
category. Mummery LJ in the Court of Appeal probably made this mistake 
when he suggested that acting “outside the four corners” of a power is a 
breach of fiduciary duty.65 It should be remembered that not all duties owed 
by a trustee or other fiduciary are fiduciary duties.66 Secondly, because the 
way in which a beneficial power of appointment is now distinguished from 
what was described by the House of Lords in McPhail v Doulton as a “trust 
power” is by describing it as a fiduciary power67, it can easily be assumed that 
all duties to which the donee of the power is subject are fiduciary duties. That 
is no more the case than that all duties owed by trustees are fiduciary duties. 
Finally, a person in a fiduciary position may act in more than one capacity, eg 
both as custodian of funds and as a financial or tax adviser. It would surely be 
ludicrous to suggest that advice given by a trustee on financial or tax matters 
was subject to a fiduciary duty, whilst the same advice given by an 
independent (ie separate from the trustee) adviser is subject only to a duty to 
take reasonable care. 

 
Do the categories have sharp or soft edges? 

 
The three categories of breach of trust are relatively sharply distinguished. 

It would take a considerable stretch of language to describe the duties of a 
trustee to take reasonable care in the selection of investments as an obligation 
deriving from the duty of loyalty, and therefore a fiduciary duty. That does 
not mean that there can never be disagreement as to exactly where the 
boundaries between the categories lie. Lloyd LJ in Pitt v Holt indicates a 
degree of discomfort in including fraud on a power in the first category, but 

63 See Re Barr’s Settlement Trusts [2003] Ch 409 at [27]; Futter v HMRC at [66]. 
64 A duty most obviously reflected in the rule in Howe v Lord Dartmouth (1802) 7 
Ves Jr 137. See also Re Earl of Chesterfield’s Trusts (1883) LR 24 Ch D 643. 
65 See Mummery LJ in Pitt v Holt at [237]: “if the disposition is a misapplication of 
property outside the scope of the power (e.g. a fraud on the power) that will be a 
breach of fiduciary duty and the disposition would be void”. 
66 Bristol and West BS v Mothew [1998] Ch 1. See Pearce, Stevens and Barr, The Law 
of Trusts and Equitable Obligations (5th edn, Oxford University Press 2010 pp 914-
915). 
67 See Mettoy Pension Trustees v Evans [1991] 2 All ER 513. 

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feels constrained to do so because of previous Court of Appeal authority 
holding cases of fraud on a power to be void68; Mummery LJ justifies this 
inclusion on the basis that there is “a misapplication of property outside the 
scope of the power”69  

 
The problem relating to breach of fiduciary duty 

 
The problem which is presented by Futter v HMRC is that the Supreme 

Court is emphatic that the jurisdiction to reverse a decision of trustees for 
inadequate consideration is based upon breach of fiduciary duty. However, the 
label “inadequate consideration” appears to relate to the duties of trustees to 
act with reasonable care or prudence rather than duties of loyalty. Richard 
Nolan, commenting on Futter v HMRC in the Law Quarterly Review,70 
observes that the concept of fiduciary duty in this context must mean 
something more than the rules governing conflicts of duty and interest. 
“Clearly, what is meant in Futter is wider than that: the conflicts rules already 
provide for a transaction that was made in conflict of duty and interest to be 
prima facie voidable, so the rule in Futter would be redundant if limited to 
breaches of fiduciary duty in that narrow sense. Context also makes it plain 
that a wider meaning of “fiduciary duty” is intended.”  

 
What constitutes breach of fiduciary duty? 

 
There is a very real question as to what the wider meaning of breach of 

fiduciary duty in this context can be. Whilst the Court of Appeal places 
considerable emphasis upon the need for a breach of fiduciary duty, it is less 
clear about what will constitute such a breach. Longmore LJ makes no 
observations on the matter, beyond concurring in the judgment of Lloyd LJ. 
Mummery LJ suggests that the breach of fiduciary duty in relation to 
inadequate deliberation consists of “a flaw in the manner in which the 
discretion has been exercised”71 having earlier cited as examples “that the 
fiduciary has left a relevant consideration out of account or has taken an 
irrelevant consideration into account”.72 Those factors, of course, are 
considerations which are more relevant to deciding whether there has been a 
failure to act with reasonable care than to whether there has been a breach of a 

68 Pitt v Holt [2011] EWCA Civ 197 at [97] - [98]. 
69 Ibid at [237]; see also Lloyd LJ at [96]. 
70 Richard Nolan, ‘Fiduciaries and their flawed decisions’ (2013) 129 LQR 2013, 
469-473. 
71 Pitt v Holt [2011] EWCA Civ 197 at [233]. 
72 Ibid at [231]. 

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duty of loyalty. Lloyd LJ equally appears to take the view that a failure to take 
reasonable care will be sufficient to allow a decision to be set aside, while at 
the same time insisting that there should be a breach of fiduciary duty. In one 
of his statements about when a trustee decision can be overturned, Lloyd LJ 
does not explicitly require a breach of fiduciary duty at all, but merely that 
“the trustees have in some way breached their duties in respect of that 
exercise” of a discretionary power.73 This could be taken as an isolated and 
incautious observation were it not that his subsequent remarks similarly 
suggest that any breach of trust, including a breach of the statutory or 
common law duty of reasonable care74 would be sufficient to ground 
intervention by the court at the instance of an affected beneficiary. In those 
instances where he refers to breach of fiduciary duty he appears to use the 
term interchangeably with breach of trust75 and he gives three examples of 
breach of fiduciary duty: failing to consider a discretion which trustees are 
under a duty to consider,76 failing to take into account a relevant factor, and 
taking into account some irrelevant matter.77The first of these will be 
considered later; the other two were the examples picked up in Mummery 
LJ’s concurring judgment. 

In the Supreme Court similar emphasis is given to the need for breach of 
fiduciary duty. Lord Walker agrees “that for the rule to apply the inadequate 
deliberation on the part of the trustees must be sufficiently serious as to 
amount to a breach of fiduciary duty.”78 The nearest he gets, however, to 
describing what would constitute a breach of fiduciary duty is that he says 
that, in addition to strict liability for acting outside the scope of their powers, 
“Trustees may also be in breach of duty in failing to give proper consideration 
to the exercise of their discretionary powers, and a failure to take professional 
advice may amount to, or contribute to, a flawed decision-making process.”79  

The conclusion therefore seems to be that a breach of fiduciary duty in 
this context can consist of a failure to take reasonable care.80 On the surface 

73 Ibid n 71 at [99].  
74 Ibid n 71 at [107] and [162]-[163]. 
75 See Pitt v Holt [2011] EWCA Civ 197 at [99] and [136]. 
76 Ibid at [110]. 
77 Ibid n 75 at [127] He also said at [127] “The trustees' duty to take relevant matters 
into account is a fiduciary duty, so an act done as a result of a breach of that duty is 
voidable.” This identical phrase is repeated at [222]. 
78 Futter v HMRC [2013] UKSC 26 at [73]. Lord Walker’s agreement was with 
Lightman J in Abacus Trust Co (Isle of Man) v Barr [2003] Ch 409 although it also 
reflects agreement with the Court of Appeal in Pitt v Holt. 
79 Ibid at [80]. 
80 This is the normal civil law standard of reasonable care. Lloyd LJ explicitly 
rejected the test used in public law set out in Associated Provincial Picture Houses 

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this looks like requiring one kind of breach of duty, but defining the 
obligation in the terms of another kind of breach of duty.81 

 
Why is the test expressed as breach of fiduciary duty? 

 
The question then arises as to why what may be simply a failure to 

consider all relevant factors – a failure to take reasonable care – is described 
as a breach of fiduciary duty. No explicit answer is given in either Pitt v Holt 
or Futter v HMRC. However, there is an implicit answer. One of Lloyd LJ’s 
examples of a breach of fiduciary duty is a failure to consider a discretion 
which trustees are under a duty to consider.82 Such a power is, of course, a 
fiduciary power rather than a beneficial power: it is a power which the donee 
(often a trustee) holds under an obligation at least to consider its exercise, and 
which the donee is obliged to exercise in a way which takes heed of those 
whom it is intended to benefit. In relation to such powers the duties of the 
fiduciary are not merely to act with loyalty in the sense of acting selflessly 
and in a way which presents no conflict of personal interest. There is also a 
duty to have regard to the best interests of the potential beneficiaries. Within 
this duty can be found the obligation of trustees to act in an even handed way 
between those beneficiaries entitled to income, and those entitled to capital. 
The reference to fiduciary duty in this context may therefore simply be a 
convenient shorthand for duties to take reasonable care or to act prudently 
which arise because a power is held subject to obligations to others. 

 
Does the rule apply only to dispositive powers? 

 
Many of the cases in which the rule in Re Hastings-Bass has been 

considered have involved discretionary dispositive powers, and both Lloyd LJ 
and Mummery LJ in Pitt v Holt refer several times to the court determining 
the validity of this type of power. This could be taken to suggest that the rule 
is limited to discretionary dispositive powers. There is much less in the 
judgment of Lord Walker in Futter v HMRC to suggest such a limitation, and 
it is hard to see why it would be justified. The first limb of the rule in Re 
Hastings-Bass cannot be confined to discretionary dispositive powers: any 

Ltd v Wednesbury Corporation [1948] 1 KB 223: Pitt v Holt [2011] EWCA Civ 197 
at [77]. 
81 Miguel Colebrook, "Get out of jail free" card: the courts' offer of assistance to 
errant trustees, [2013] Denning LJ 211-223 at 220 also makes the point that ‘we 
typically do not unwind transactions for negligence. Negligent conduct typically 
results in a claim for loss.’ 
82 See above text to footnote 76. 

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purported action by trustees which falls outside the four corners of the trust or 
which is prohibited by general law will be void. A failure to use the 
appropriate mode of transfer will be just as ineffective in transferring funds to 
a new custodian trustee as it will be to a beneficiary.  

There also appears to be no reason of principle why the inadequate 
consideration rule should be limited to dispositive powers. In one of the cases 
for decision in Pitt v Holt and Futter v HMRC the question involved the terms 
of a trust established by Mrs Pitt, acting as a receiver appointed by the Court 
of Protection, to receive damages to which Mr Pitt was entitled for injuries 
sustained in a road accident. This was not a typical example of the exercise of 
a discretionary power. If this situation could fall within the rule, then surely 
other decisions relating to the allocation of funds should also be within the 
rule. For instance, a decision of trustees to distribute to a member of a class 
without considering the claims of the other class members would be voidable. 
Why not also a decision of trustees to invest in a way which unduly favours 
one class of beneficiary (perhaps by prioritising capital growth over income 
and thus prejudicing an income beneficiary)? This would truly be a breach of 
fiduciary duty (the duty to act even-handedly between beneficiaries), and in so 
far as third parties might be affected, this could be dealt with by the usual 
safeguards for voidable transactions (including the bona fide purchaser 
defence).  

The English High Court decision in Donaldson v Smith,83 which could be 
taken to suggest that the rule in Re Hastings-Bass is confined to dispositive 
powers, decided only that the (old) rule could not apply to powers which were 
wholly unqualified. In that case the judge held that the power of trustees as 
legal owners in land was an unqualified power, and that even if the exercise of 
that power was subject to the rule in Re Hastings-Bass, the effect of the rule 
would have been to make its flawed exercise voidable rather than void. In the 
Jersey case of Seaton Trustees Limited v Morgan, Re the Winton Trust84 
Commissioner Clyde-Smith said that he could not “see any reason in principle 
to distinguish between dispositive and administrative discretions” in applying 
the old rule.85 That is the better view, and it should surely also apply to the 
redefined rule.  

83 Donaldson v Smith [2006] EWHC B9 (Ch). 
84 Seaton Trustees Limited v Morgan [2007] JRC 206. 
85 Other cases where the rule has been applied to administrative powers are Leumi 
Overseas Trust Corporation v Howe [2007] JRC 248 (borrowing by trustees) and Re 
L,Re Representation of Mrs P, Re the R Trust [2011] JRC 085 (appointment of new 
trustee). Contrast Re Duxbury’s Settlement Trusts [1995] 1 WLR 425 (decision of 
Rattee J that the rule in Re Hastings-Bass did not apply to the appointment of a trustee 
under Trustee Act 1925 s36 not challenged on appeal). 

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Foundations of sand? 
 
Lloyd LJ in the Court of Appeal and Lord Walker in the Supreme Court 

both concluded following an analysis of precedent that the rule in Re 
Hastings-Bass had been developed beyond the bounds justified by authority. 
That was not a foregone conclusion. Deputy Bailiff Birt, in the Jersey case of 
In the Matter of the Green GLG Trust86 considered that the old rule in Re 
Hastings-Bass was “entirely consistent with precedent and principle.” It 
would have been open to the English courts to find a similar basis for the 
unreformed rule. The cases on the exercise of a power for an improper 
purpose (the doctrine known as fraud on a power), including Cloutte v 
Storey87 (in which the Court of Appeal held that such an exercise was void), 
fit inconveniently into the new analysis. Cloutte v Storey in particular “may 
have to be revisited one day.”88 Other cases, the most well-known of which is 
Klug v Klug,89 could have supported a broader rule. In that case the court 
overrode a decision by a mother not to make an advancement to her daughter 
because she disapproved of her daughter’s choice of husband. Lord Walker 
sidestepped this by observing that:  

“The old cases as to the maintenance of children are rather exceptional 
... Some judicial pronouncements in these cases should not be taken 
out of context.”90 
 
Were it not for the hostility of the senior judiciary to the rule, a different 

outcome to the case would have been possible, and it is therefore a shame that 
the Court of Appeal and the Supreme Court based their decisions almost 
exclusively on an analysis of precedent rather than on policy considerations. 
There is, after all, a logic to limiting the extent to which the courts can 
interfere with the decisions of trustees. Firstly, the life of trustees would be 
made impossible if their decisions could be set aside whenever the courts 
considered that they would have reached a different decision if the relevant 
considerations had been balanced differently. There is also an arguable 
perversity if there is a wider jurisdiction to set aside decisions made by 

86 In the Matter of the Green GLG Trust [2002] JLR 571 at [25] to [28]. 
87 Cloutte v Storey [1911] 1 Ch 18. 
88 Futter v HMRC [2013] UKSC 26 at [62]; [2011] EWCA Civ 197 at [98]. 
89 Klug v Klug [1918] 2 Ch 67. 
90 Futter v HMRC [2013] UKSC 26 at [64]. 

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trustees compared with decisions made by individuals,91 and there is therefore 
merit in increasing the role of mistake in correcting flawed decisions.92  

 
WHITHER THE RULE IN RE HASTINGS-BASS? 

 
The end of the story? 

 
Longmore LJ in Pitt v Holt expressed the view that “these appeals provide 

examples of that comparatively rare instance of the law taking a seriously 
wrong turn, of that wrong turn being not infrequently acted on over a twenty 
year period but this court being able to reverse that error and put the law back 
on the right course”.93 He expressed the hope, although without great 
optimism, that the rule in Re Hastings-Bass would feature much less 
prominently in the future. His hope, but also his lack of pessimism, have some 
foundation. 

 
How much has really changed? 

 
There has been less of a change in the formal rules than the Court of 

Appeal in Pitt v Holt and the Supreme Court in Futter v HMRC may have 
believed. Probably the most significant change is the decision that trustees 
who reasonably rely upon professional advice in relation to a matter within 
their powers do not act in breach of trust if that advice proved to be 
inaccurate. Setting aside this crucially important change, there has been more 
of a clarification of points of doubt than a sea change in the law. What is left 
of the Hastings-Bass rule is not in most respects materially different from 
what preceded it. Admittedly, the rule has been broken into two, the excessive 
execution and the inadequate deliberation rules, but the main effect of this 
distinction is to differentiate those decisions which are void from those which 
are voidable. For the second of the two rules, there is also a requirement of 
breach of trust, but this breach can consist of “the failure of the trustees to 
take into account a relevant factor to which they should have had regard ...or 
by their taking into account some irrelevant matter”94. This is almost exactly 
how Lloyd LJ characterised the old Hastings-Bass rule in Sieff v Fox: he said 
that the rule applied where trustees “would not have acted as they did had they 

91 The amendment to the Jersey Trusts Law referred to below applies to decisions by 
individuals transferring assets to a trust as well as to decisions by trustees. 
92 See Natalie Lee, ‘Futter v HMRC; Pitt v HMRC: the rule in Hastings-Bass and of 
mistake reviewed’ [2014] Conv. 175-185 at 181-182.  
93 Pitt v Holt [2011] EWCA Civ 197 at [227]. 
94 Pitt v Holt [2011] EWCA Civ 197 at [127]. 

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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”95. There are, however, some other factors in play. 

 
The hostile approach 

 
Lloyd LJ was critical of the way in which trustees had been able 

themselves to invoke the rule in Re Hastings-Bass to unpick the exercise of a 
discretion that had produced unfortunate results. He believed that it would 
only rarely be appropriate for trustees to initiate proceedings, and ‘if in future 
it is desired to challenge an exercise by trustees of a discretionary power on 
this basis, it will be necessary for one or more beneficiaries to grasp the nettle 
of alleging and proving a breach of fiduciary duty on the part of the 
trustees.’96 It is thus ironic that one of the first cases to invoke the new rule in 
Re Hastings-Bass in a substantial way was a case initiated by trustees. In 
Roadchef (Employee Benefits Trustees) Ltd v Hill97 a Roadchef director who 
was in a dominant position secured the appointment of another company of 
which he was also a director as a trustee of the Roadchef employee benefits 
scheme. Through the director’s influence, the scheme was amended in such a 
way as to divert significant benefits to the director. Proudman J, applying 
Futter v HMRC, held that the amendments were void. She thought that there 
might have been inadequate deliberation, but more importantly, the 
amendments to the scheme fell outside the trustees’ powers of amendment.98 
In addition, the changes had been made for an improper purpose, so that the 
amendments were void on the basis that they were a fraud on the power.99 For 
good measure, Proudman J also held that the amendments could be set aside 
on the grounds of mistake.100 The action in this case had been brought by the 
trustees of the employee benefits scheme, who were, of course, the trustees 
who had made the impugned decisions. Proudman J considered that this was 
not relevant in so far as the impugned decisions were void, and that this was 
in any event an appropriate case for the trustees to bring an action since the 
trust was no longer under the control of the director who had orchestrated the 
improper decisions, the trustees were able to bring claims for breach of duty 
that were not available to the beneficiaries, and the trustees in the 

95 Sieff v Fox [2005] 1 WLR 3811 at [119]. See above text to footnote 4. 
96 Pitt v Holt [2011] EWCA Civ 197 at [130]. 
97 Roadchef (Employee Benefits Trustees) Ltd. v Hill [2014] EWHC 109 (Ch). 
98 Roadchef (Employee Benefits Trustees) Ltd. v Hill [2014] EWHC 109 (Ch) at 
[122]-[123]. 
99 Ibid at [131]. 
100 Ibid n 98 at [136]. 

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circumstances were able to act as representatives of the beneficiaries who had 
brought several actions which were being stayed pending the outcome of the 
trustees’ proceedings. The case therefore illustrates that there may be a range 
of circumstances which would justify the trustees continuing to invoke the 
rule in Re Hastings-Bass in partnership with the beneficiaries rather than in 
conflict with them. 

There is also an interesting paradox about the requirement that there be a 
breach of trust in order to justify the operation of the rule in Re Hastings-
Bass. Whilst trustees may normally be reluctant to be found in breach because 
of the potential liability to which it exposes them, since the rule in Re 
Hastings-Bass can reverse the effect of their flawed decision, a finding that 
they are in breach could also invoke a mechanism which exonerates them 
from liability. The trustees may therefore perversely be incentivised to assist 
the beneficiaries in playing a card which can still get the trustees out of jail 
free. There is, however, an element of jeopardy: since the trustees’ decision is 
only voidable, and relief is at the discretion of the court,101 a judge, in the 
exercise of discretion, may decide that a flawed decision should stand and that 
the beneficiaries should be left with their remedies for breach of trust. The 
trustees might also be expected to pay their own costs.102 

Finally, the newly broadened concept of mistake may prove to be as 
frequently invoked a tool as the rule in Re Hastings-Bass used to be. The 
majority of cases in which judgments are available since Futter v HMRC have 
pursued this route, albeit mostly with limited success.  

 
Judicial hostility 

What is probably a more important factor in discouraging applications to 
invoke the rule in Re Hastings-Bass is the evident judicial hostility to the use 
of the rule to extract trustees from a poor decision. The solidarity of the 
judiciary in the higher courts in seeking to constrain the rule in Re Hastings-
Bass was striking. The Supreme Court bench of seven judges was unanimous, 
with only a single judgment. Before this, the Court of Appeal had been 
unanimous, with no indication of any difference of opinion between the 
Court’s members. Lloyd LJ referred to critical lectures by Lord Walker in 
2002103 and by Lord Neuberger in 2009104 and in the Judicial Studies Board 

101 Pitt v Holt [2011] EWCA Civ 197 at [101] and [127]; Futter at [93]. 
102 Futter v HMRC [2013] UKSC 26 at [69]. 
103 Lord Walker, ‘The Limits of the Principle in Re Hastings-Bass’, Lecture at Kings 
College London, [2002] PCB 226. 

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Annual Lecture,105 given shortly after the Court of Appeal delivered its 
decision, Lord Neuberger (who was later appointed President of the Supreme 
Court and was a member of the bench for the appeal), repeated his criticism, 
described the judgment of Lloyd LJ as “magisterial”, and said that the 
development was based upon ‘a cornerstone placed on sand’.106 This 
background suggests that applications to use the rule in Re Hastings-Bass are 
likely to be less warmly received than was the case before the appeals. Since 
it is necessary to find a breach of trust, and trustees are not required always to 
be right, it is possible for judges to find that a decision of trustees – unless 
manifestly misdirected or misinformed – is within the margin of trustees’ 
appreciation and not a breach. A case decided between Pitt v Holt and Futter 
v HMRC illustrates the point. In Prudential Staff Pensions Ltd v The 
Prudential Assurance Company Ltd 107 one of the matters addressed was 
whether the trustees had acted properly in making annual discretionary 
increases to pensions in payment rather than establishing a scheme under 
which pensions were increased automatically in line with increases in the 
Retail Prices Index. The trustees had failed to take advice on whether such an 
action was within their powers. Newey J approached this question by asking 
himself whether the trustees had been in breach of trust in failing to take 
advice (they seem to have given this question no thought at all). Having 
concluded that they had acted reasonably in not taking advice, he held that the 
trustees’ decision relating to indexation was valid. 

 
The role of HMRC 

 
Pitt v Holt and Futter v Futter were the first prominent domestic cases 

involving the rule in Re Hastings-Bass in which Her Majesty’s Revenue and 
Customs chose to become involved.108 In earlier cases there was what some 

104 Lord Neuberger, “Aspects of the law of mistake: Re Hastings-Bass,” Lecture to the 
Chancery Bar Association Conference in London on 16 January 2009, (2009) 15(4) 
Trusts & Trustees 189–99.  
105 Lord Neuberger, “Open Justice Unbound”, The Judicial Studies Board Annual 
Lecture 2011, 16 March 2011 at [17]. 
106 Lord Neuberger, “Open Justice Unbound” , para [18] 
107 Prudential Staff pensions Ltd v The Prudential Assurance Company Ltd. [2011] 
EWHC 960 (Ch) (14 April 2011). 
108 HMRC has also intervened in cases outside the jurisdiction. In HMRC v Gresch 
and RBC Trust Company Limited [2009] GLR 239 HMRC successfully sought the 
right to be represented in a Hastings-Bass application in Guernsey. The Privy Council 
denied leave to appeal from the decisions of the Guernsey Court of Apppeal. HMRC 
made written representations in a Jersey case which were considered as a matter of 
courtesy In the Matter of Seaton Trustees Limited [2009] JRC 050. 

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judges suggested was a rather cosy conspiracy between trustees and 
beneficiaries to overturn a decision which has proved, with the advantage of 
hindsight, to be less advantageous than it was thought to be when the decision 
was made. Lloyd LJ indicated that the absence of HMRC from the cases in 
which the Hastings-Bass rule had been considered might have led to an 
absence of strong forensic debate and testing of the limits of the rule. The 
more recent cases demonstrate that HMRC has changed its policy and is now 
seeking representation in similar cases, a change in policy driven in part, no 
doubt, by a desire to increase the bite of existing taxes at a time when the 
Government is seeking to increase tax revenue but the scope for new taxes is 
limited. HMRC involvement is likely to make it more difficult for trustees or 
beneficiaries to establish a case for reversing a decision. That task would be 
made even more difficult were the courts to endorse the suggestion of Natalie 
Lee, writing in the Conveyancer, who argues that (presumably only where a 
decision is voidable), HMRC should be treated as an innocent third party and 
that where a transaction is set aside it should be “subject to a term that HMRC 
(and thus the public purse) should not be prejudiced.” 109 Most chancery 
lawyers would be surprised at this suggestion which appears to equate the 
interest of HMRC with a party who would have a beneficial interest in the 
funds if a flawed decision remained uncorrected.110  

 
Incorrect advice 

 
It is, as Lord Walker recognised111 no defence to trustees who have acted 

outside their powers that they have done so on the basis of incorrect advice. 
However, where inadequate consideration is concerned, fault on the part of 
the trustees is a precondition for invoking the new rule in Re Hasting-Bass. 
Whilst trustees may normally be able to rely upon professional advice they 
have commissioned, it would still be a breach of trust to follow it if to do so 
was unreasonable, for instance if the advice contains a recital of facts which is 
clearly wrong.112 Where reliance on incorrect advice is reasonable, but in 
consequence a decision of trustees cannot be reversed, there may notionally 

109 Natalie Lee, ‘Futter v HMRC; Pitt v HMRC: the rule in Hastings-Bass and of 
mistake reviewed’ [2014] Conv. 175-185 at 182. Lee draws on Bhandari, ‘Pitt v Holt, 
Futter v Futter: at last, Hastings-Bass limited, but is it enough?’ [2011] B.T.R. 288. 
110 Compare the view expressed by Sir Philip Bailhache, Commissioner of the Royal 
Court of Jersey in Re R [2011] JRC 117 at [39]. 
111 Futter v HMRC [2013] UKSC 26 at [80]. 
112 An example given by Richard Wilson, ‘The rule in Re Hastings-Bass: Futter v 
HMRC; Pitt v HMRC - further thoughts’ [2014]  Private Client Business 20 at 22-
23. 

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be a remedy against the advisers, but this is not as straightforward as it may 
seem. Where trustees seek professional advice, the primary duty to provide 
competent advice is owed to the trustees. However, the liability to the trustees 
may be meaningless, for if the trustees are not in breach of trust because they 
have sought and followed professional advice, the trustees will bear no loss 
for which they can seek to be indemnified. It would therefore be necessary to 
establish that the duty was owed not just to the trustees, but to the trust. 
Actions by the beneficiaries may also be subject to a range of difficulties. It 
may be hard to identify who are appropriate claimants, particularly in the case 
of discretionary trusts, those where there are unborn beneficiaries, or where 
there is a power to add beneficiaries. The beneficiaries, unless the trustees are 
joined on the basis that there is a duty to the trust which constitutes trust 
property, will have to show that there is a special relationship giving rise to a 
tortious duty of care under Hedley Byrne v Heller. Lord Nicholls explained in 
Royal Brunei Airlines v Tan113 that “it is difficult to identify a compelling 
reason why, in addition to the duty of skill and care vis-a-vis the trustees 
which the third parties have accepted, or which the law has imposed upon 
them, third parties should also owe a duty of care directly to the 
beneficiaries.” 

Further difficulties which may affect the remedies of the beneficiaries are 
that incorrect advice is not necessarily negligent, and even if it is negligent, 
the advisers may be protected by an exemption clause. There may also be 
issues about whether the brief to the advisers required them to provide advice 
on the issue concerned. Where more than one adviser has been consulted it 
may not be obvious who is responsible. Lloyd LJ (perhaps unwittingly) 
demonstrates the problem that Mrs Pitt faced in identifying the right 
defendant if she chose to pursue a negligence claim: 

 
“Frenkel Topping deny that they were under a duty to advise her about 
IHT [Inheritance Tax]. However that may be, it seems to me that, as 
between the various advisers which acted for and advised her, it must 
have been the duty of one or other of them, at least, either to advise 
her about any risk as to IHT, or to point out that she might need such 
advice and see that she got it.”114 

 
A different problem is illustrated by the trust of which Mr Futter was a 

trustee. It was held that he was not in breach of trust because he relied upon 
advice given by the firm of which his co-trustee was a partner. The co-trustee 
was also absolved from liability for breach of trust because the advice came 

113 Rotal Brunei Airlines v Tan [1995] 2 AC 378 at 391. 
114 Pitt v Holt [2011] EWCA Civ 197 at [162]. 

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from a different solicitor in the firm, and the Supreme Court agreed with the 
Court of Appeal “that it would be artificial to distinguish between the two 
trustees, who acted together in making and effectuating their decisions.”115 It 
would not be hard to envisage circumstances, however, where the professional 
trustee is at fault for giving or following incorrect advice when a lay trustee is 
not. Is it sufficient to ground relief that only one trustee, perhaps only one 
trustee of several, is in breach? 

Lastly, different limitation periods apply to claims against trustees (6 
years from act complained of or beneficiary acquiring interest) and advisers (6 
years from negligent advice). Given the number of potential difficulties it is 
hardly surprising that the Jersey courts have indicated a reluctance to oblige 
beneficiaries to seek a remedy against financial advisers.116 

 
Defences to breach of trust 

 
Lord Walker “would not treat that clause [an exoneration clause in 

conventional terms] as ousting the application of the Hastings-Bass rule, if it 
were otherwise applicable.”117 The clause to which he was referring was a 
clause stating that “no trustee shall be liable for a breach of trust arising from 
a mistake or omission made by him in good faith.” This form of wording 
acknowledges that there has been a breach of trust whilst relieving the trustee 
of liable. However, it is possible for clauses to be drafted in a way which 
defines the standard of care rather than providing relief from liability for 
carelessness. It would be rather odd if the rule in Re Hastings-Bass might or 
might not apply, depending upon the way in which a limitation of liability 
clause is drafted. It is highly likely that, however an exoneration or limitation 
of liability clause is drafted, the courts will use as a test the standard of care 
which would need to be demonstrated by a trustee who is not protected by any 
such clause. 

Similarly, the effect of the consent of the beneficiaries may also be an 
issue which needs to be addressed in the future. It is not uncommon for 
trustees to consult the beneficiaries about the exercise of discretions. If the 
beneficiaries consent to a particular transaction, this can constitute a defence 
to a claim of breach of trust.118 If the inadequate consideration rule requires a 
breach of trust, does the consent of the beneficiaries preclude relief? It is 

115 Futter v HMRC [2013] UKSC 26 at [96]. 
116 In the Matter of the Green GLG Trust [2002] JLR 571at [29]; In the Matter of the 
Howe Family Number 1 Trust at [32]; In the Matter of Seaton Trustees Limited [2009] 
JRC 050 at [26]. 
117 Futter v HMRC [2013] UKSC 26 at [89]. 
118 Re Pauling’s Settlement Trusts [1964] Ch 303. 

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surely relevant in that it may preclude the hostile claim which appears to be a 
normal prerequisite for success; it may also operate to estop the beneficiary 
from later claiming that there has been inadequate consideration, although it is 
much less likely to be an obstacle for relief for mistake. It should not be 
relevant to some forms of excessive execution, although it is possible that the 
consent of beneficiaries could be interpreted as altering the “four corners” or 
scope of what is permitted by the trust. The beneficiary’s consent must be 
informed consent to operate as a defence to a claim for breach of trust119: if 
consent does preclude Hastings-Bass relief, it will also be interesting to see 
how far consent can be considered to be fully informed where it is based on 
honestly held but inaccurate advice.  

 
The impact offshore 

 
The law in offshore jurisdictions such as Guernsey and Jersey is not 

identical to the law of England. Whilst as a matter of comity the decisions of 
the English courts are treated with respect and careful consideration, it cannot 
be assumed that they will be followed120 (although a slightly worrying 
example of the Privy Council applying English rules despite the different 
context of Guernsey trust law is found in Spread Trustee Company Ltd v 
Hutcheson.121 The old rule in Re Hastings-Bass has been applied or discussed 
in a number of cases in Jersey,122 and it was established by the Royal Court 
that proof of breach of trust was not a prerequisite to the application of the 
rule.123 The Court of Appeal decision in Pitt v Holt represented a dilemma for 

119 Holder v Holder [1968] Ch 383. 
120 Re B [2012] JRC 229. 
121 [2011] UKPC 13. See Jennifer Shearman and Robert Pearce, “Exempting a trustee 
for gross negligence” [2011] Denning LJ 181-191.  
122 In the Matter of the Green GLG Trust [2002] JLR 571; In the Matter of Friedman 
and Asiatrust Limited [2006] JRC 187; In the Matter of the Winton Investment Trust 
[2007] JRC 206; Leumi Overseas Trust Corporation v Howe [2007] JRC 248; In the 
Matter of the Howe Family Number 1 Trust [2007] JLR 660; In the Matter of the 
Representation of Vistra Trust Company (Jersey) Limited [2008] JRC 111; In the 
Matter of Seaton Trustees Limited [2009] JRC 050; Re B and C [2009] JRC 245 and 
In the Matter of the V Settlement [2011] JRC 046. For a commentary on these cases 
see Brown, “The development of Hastings-Bass in Jersey,” STEP Journal May 2010 
and Wakeham, “The end of ‘the rule in Re Hastings-Bass’?” STEP Journal May 
2011. 
123 In the Matter of the Green GLG Trust [2002] JLR 571 applied in Leumi Overseas 
Trust Corporation v Howe [2007] JRC 248 and Re Representation Vistra Trust 
Company (Jersey) Ltd [2008] JRC 111. 

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the Royal Court. In Re B124 the Royal Court suggested that it would have 
followed Pitt v Holt had it been necessary to the decision in that case.  

Most uncertainty in relation to Jersey law has now been removed by an 
amendment to the Jersey Trust Law 1984,125 introducing articles 47B to 47J. 
This gives the courts power to declare voidable or of no effect dispositions to 
a trust or the exercise of powers in relation to a trust which are the result of 
mistake or of failing to take into account any relevant considerations or of 
taking into account irrelevant considerations. There is explicitly no 
requirement of ‘any lack of care or other fault’.126 It is possible that the law 
does not extend to situations where trustees have acted in excess of their 
powers, but it is at least arguable in such a case that the trustees have failed to 
take into account a relevant consideration. It is widely believed that Guernsey 
and the Isle of Man will introduce similar laws. This reflects the desire in both 
jurisdictions to develop a trusts system which offers a benign environment for 
both trustees and beneficiaries. 

 
CONCLUSION 

 
Futter v HMRC has provided some welcome clarification in an area of the 

law which was overdue for review by the higher courts. However, the 
decision leaves a number of important questions unresolved, the most 
important of which is the meaning in this context of breach of fiduciary duty 
as it relates to decisions which are flawed because of a failure to consider 
relevant considerations or because they were influenced by irrelevant 
considerations. The one thing of which there can be little doubt is that, despite 
the judicial aversion which has been demonstrated to allowing trustees to 
continue playing the “get out of jail free” card, there will continue to be 
occasions where decisions with unwelcome and unanticipated outcomes have 
been made which trustees and beneficiaries alike will seek to avoid. Murphy’s 
law – what can go wrong will go wrong – applies in most areas of endeavour, 
and trusts are by no means exempt. The courts will have to continue to 
grapple with the rule in Re Hastings-Bass, and their task has been made only 
marginally easier by Futter v HMRC.  

124 [2012] JRC 229. A similar conclusion was reached in In the matter of the Onorati 
Settlement [2013] JRC 182. 
125 The Trusts (Amendment No.6) (Jersey) Law 2013 came into force on October 25, 
2013. See  
126 For a discussion see William Redgrave, “Leviathan can look after itself: Jersey 
legislated on mistake and Hastings-Bass” [2014] Private Client Business 92. 

201 
 

                                                      


	INTRODUCTION
	Background
	The Hastings-Bass rule
	The history of the cases

	Mistake
	The statement of the rule
	The relevance of taxation
	Uncertainty about the criteria
	Unjust or unfair to whom?
	Operative mistake
	Can oversight be a mistake?

	The (new) rule(s) in Re Hastings-Bass
	Excessive execution
	The ambit of the rule
	(i) Procedural defects
	(ii) Substantive defects
	(iii) Fraud on a power
	(iv) Powers of advancement
	(v) Other legal defects

	A grouping of disparate situations
	Is there always a breach of trust?
	Consent of beneficiaries
	Is the invalidity automatic?
	Ambulatory invalidity

	Inadequate deliberation
	The elements of the rule
	Breach of trust the basis?
	Categorisation of breaches of trust
	Common slips concerning fiduciary duties
	Do the categories have sharp or soft edges?
	The problem relating to breach of fiduciary duty
	What constitutes breach of fiduciary duty?
	Why is the test expressed as breach of fiduciary duty?
	Does the rule apply only to dispositive powers?
	Foundations of sand?

	Whither the rule in Re Hastings-Bass?
	The end of the story?
	How much has really changed?
	The hostile approach
	Judicial hostility
	The role of HMRC
	Incorrect advice
	Defences to breach of trust
	The impact offshore

	Conclusion