In the matter of the Lochmore Trust

The Trustee and the adult Beneficiaries were convened but did not appear and were not represented at the hearing.

This is an application by the settlor to set aside the Lochmore Trust ("the Trust") on the grounds of mistake.

The Court has received affidavits from the settlor, from Mr David Jenner, a director of Lutea Trustees Limited ("Lutea") and Mr Michael Dawes, the current tax adviser of the settlor.

We find the facts to be as follows. Although not domiciled in the United Kingdom in the conventional sense, the settlor is deemed to be domiciled in the UK for inheritance tax purposes. In 1995 he caused to be incorporated in Jersey a company called Lochmore Holdings Limited ("the Company"). The shares in the Company were held by Lutea and another company in the Lutea group as nominees for the settlor.

It is quite clear from the evidence before us that there was a fundamental misunderstanding between the settlor and Mr Jenner. The settlor thought that, in accordance with the advice of BKL Tax, the shares had been transferred to the Trust by way of a sale with the sale price remaining outstanding as a loan. Lutea, on the other hand, had not appreciated that this was required and had simply transferred beneficial ownership of the shares in the Company to the Trust on 31st March, 2008. for no consideration, so that it operated as a gift by the settlor to the Trust.