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ACKNOWLEDGEMENTS
The authors gratefully thank the organisers and participants at the Modern Studies in the Law of Trusts, Wealth Management & Philanthropy conference, held on July 27–28, 2023, at the Yong Pung How School of Law, Singapore Management University, and co-organised by King’s College London and the University of York, at which a version of this article was presented. We also gratefully thank the editors of this special issue for their useful comments, as well asthe anonymous reviewer.
DISCLOSURE STATEMENT
No potential conflict of interest was reported by the author(s).
Notes
1 Max Rheinstein, ‘Division of Marital Property’ (1975) 12 Willamette Law Journal 413.
2 For comparative discussion of this extension see Robert Leckey, ‘Cohabitation and Comparative Method’ (2009) 72 Modern Law Review 48.
3 We will use ‘spouse’ to refer to any relationship partners.
4 On the development of discretionary trusts see Jessica Palmer and Charles Rickett, ‘The Revolution and Legacy of the Discretionary Trust’ (2017) 11 Journal of Equity 157; Lionel Smith, ‘Massively Discretionary Trusts’ (2017) 70 Current Legal Problems 17 (compare Man Yip and Tang Hang Wu’s article in this special issue).
5 Kent D Schenkel, ‘Exposing the Hocus Pocus of Trusts’ (2012) 45 Akron Law Review 63; Mark Bennett and Adam Hofri-Winogradow, ‘The Use of Trusts to Subvert the Law: An Analysis and Critique’ (2021) 41 Oxford Journal of Legal Studies 692.
6 JSC Mezhdunarodniy Promyshlenniy Bank v Pugachev, [2017] EWHC 2426 (Ch), [178].
7 Jesse Wall, ‘The Functional–Formal Impasse in (Trust) Property’ (2018) 14 International Journal of Law in Context 437.
8 New Zealand Law Commission NZLC R143 Review of the Property (Relationships) Act 1976: Report (2018), [11.68].
9 Leckey (n 2) 69.
10 Mathias M Siems, ‘Bringing in Foreign Ideas: The Quest for Better Law in Implicit Comparative Law’ (2014) 9 Journal of Comparative Law 119.
11 e.g. UK Law Commission, Sharing Homes: a Discussion Paper (2002); Law Reform Commission of Nova Scotia, Final Report: Division of Family Property (September 2017); Bill Atkin, ‘Distribution of property on divorce’ in B Stark & J Heaton (eds) Routledge Handbook of International Family Law (Taylor & Francis Group 2019).
12 We will refer to ‘England’ henceforth.
13 See also Patrick O’Hagan, ‘Beneficial powers, divorce and debt: a comparative analysis’ (2018) 32 Trust Law International 73.
14 Prest v Petrodel Resources Ltd [2013] UKSC 34, [2013] 2 AC 415; Dolce Vita Fine Dining Company Limited v Zhang Lan and others [2022] SGHC 278.
15 For the ‘largely unified’ position in New Zealand for ‘de facto’ relationships, see Bill Atkin,‘“De Facto Relationships” in New Zealand—A Largely Unified Law’ (2016) 50 Family Law Quarterly 303; for Australia’s ‘equivalence’ position see Patrick Parkinson, ‘When All Roads Lead to Rome: The Problem of Treating De Facto Relationships as Marriages in Australia’ (2022) 44 Houston Journal of International Law 253. Contrast the English position, for which see Women and Equalities Committee, The rights of cohabiting partners (4 August 2022), and the various approaches in US and Canadian jurisdictions: Barbara Atwood and Naomi Cahn, ‘Nonmarital Cohabitants: The US Approach’ (2022) 44 Houston Journal of International Law 191; Robert Leckey, ‘De Facto Relationships in Canada’ forthcoming in Jens M Scherpe and Andy Hayward (eds.), The Legal Status of De Facto Relationships (Intersentia 2023).
16 Joanna Miles and Jens M Scherpe, ‘The Legal Consequences of Dissolution: Property and Financial Support between Spouses’ in John Eekelaar and Rob George (eds) Routledge Handbook of Family Law and Policy (Taylor & Francis Group 2020).
17 Sanford N Katz, Family Law in America (3 ed, Oxford University Press 2021), 131. See also Brett R Turner, Equitable Distribution of Property (4th ed, Westlaw 2023), § 1.1; Carolyn J Frantz & Hanoch Dagan, ’Properties of Marriage’ 104 Columbia Law Review 75 (2004).
18 Allison Anna Tait, ‘Divorce Equality’ (2015) 90 Washington Law Review 1245, 1255–1259; Bill Atkin ‘Property Division: Lessons from New Zealand’ in Panagiotis I Kanellopoulos, et al (eds) Essays in Honor of Penelope Agallopoulou (Sakkoulas, 2011); Esther L Lenkinski, Alexandra Carr, Halsbury's Laws of Canada – Family (LexisNexis Canada, 2022) HFA-141.
19 See Hayley Fisher and Hamish Low, ‘Who wins, who loses and who recovers from divorce?’ in Joanna Miles and Rebecca Probert (eds), Sharing Lives, Dividing Assets (Hart, 2009); Katz (n 17), 128.
20 Family Proceedings Act 1980 (NZ) s 64; Matrimonial Causes Act 1973 c 18 (Eng & W) [MCA], s 23.
21 MCA s 24(1)(c); Family Proceedings Act 1980 (NZ), s 182; Family Law Act 1975 (Aust) [AUFLA] s 85A.
22 Miles and Scherpe (n 16) 147.
23 For the US: Turner (n 17), § 8.1.
24 AUFLA s 79(1)(a) and s 90SM(1)(a)
25 AUFLA s 79(2) and s 90SM(2)(a).
26 Turner (n 17), §§ 8.3 and 8.4.
27 MCA s 25(2)(a); AUFLA s 75(2)(b).
28 Joanna Miles, ‘Should the Regime be Discretionary or Rules-Based?’ in Jessica Palmer et al, Modern Family Finance (Intersentia 2018) 286.
29 Turner (n 17) § 8.2.
30 Patrick Parkinson, ‘The Yardstick of Equality: Assessing Contributions in Australia and England’ (2005) 19 International Journal of Law, Policy and the Family 163; Stephen Cretney Family Law in the Twentieth Century (Oxford University Press 2005) Chapter 10.
31 Emma Hitchings and Joanna Miles, ‘Rules versus Discretion in Financial Remedies on Divorce’ (2019) 33 International Journal of Law, Policy, and the Family 24; Simone Wong, ‘Tapping into Trust Assets for Redistribution upon Divorce in England and Wales’ in RC Nolan, KFK Low and T Hang Wu (eds), Trusts and Modern Wealth Management (Cambridge University Press 2018).
32 See Australian Law Reform Commission, Family Law for the Future — An Inquiry into the Family Law System ALRC Report 135, [6.27]-[6.36] and [7.11]-[7.27].
33 Turner (n 17) § 8.2
34 For NZ see Bill Atkin Relationship Property in New Zealand (LexisNexis NZ 2018) 77–80. For Canada see Lenkinski (n 18) HFA-141.
35 For example: Kennon v Spry (2008) 251 ALR 257, [89]-[90] per Gummow and Hayne JJ; Yared v Karam 2019 SCC 62, [22]-[23]; Grasch v Grasch, 536 S.W.3d 191, 195 (Ky 2017); Z v Z (No 2) [1997] 2 NZLR 258.
36 Law Commission, NZLC IP44 Preferred Approach (2018), [2.79]; Marital property Act [New Brunswick], R.S.N.B. 2012, c 107, s 1.
37 Turner (n 17) §§ 8.6 and 8.7.
38 Katz (n 17), 132; Lenkinski (n 18) HFA-95 (Canadian exceptions being New Brunswick and Nova Scotia); Property (Relationships) Act 1976 (NZ) [PRA], s 8(1)(e).
39 Family Law Act s 4(2). The matrimonial home is not excluded by this provision.
40 Family Law Act, SBC 2011 [BCFLA], s 85(1). See also the Saskachewan Family Property Act, SS 1997, Ch F-6.3, s 23; the Alberta Family Property Act, RSA 2000, c F-4.7, s 7(2).
41 Property (Relationships) Act 1976 (NZ), s 8(1)(a); Family Law Act (Ontario), R.S.O. 1990, c. F.3, s 4.
42 For an overview, see Paolo Panico, International Trust Laws (2nd edition, Oxford University Press 2017) Ch 4.
43 Re Armstrong (1886) 17 QBD 521, 531.
44 Edwin Simpson and Miranda Stewart (eds) Sham Transactions (Oxford University Press 2013).
45 Jessica Palmer, ‘What to do with Trusts’ in Palmer (n 28), 182.
46 Mark Bennett, ‘Competing Views on Illusory Trusts: The Clayton v Clayton Litigation in its Wider Context’ (2017) 11 Journal of Equity 48; Lucas Clover Alcolea ‘Nothing New Under the Sun: The Case of the Illusory Trust’ (2022) 30 New Zealand Universities Law Review 225.
47 Law Commission Preferred (n 36), [6.5].
48 Law Commission Review (n 8), [11.17].
49 Law Commission Review (n 8), [11.21].
50 Vervoort v Forrest [2016] NZCA 375, [70].
51 Nicola Peart, Mark Henaghan and Greg Kelly, ‘Trusts and relationship property in New Zealand’ (2011) 17 Trusts & Trustees 866.
52 Law Commission Preferred (n 36), [6.61].
53 Law Commission Review (n 8), [11.07]-[11.10].
54 Law Commission Review (n 8), [11.65]-[11.84].
55 Prest v Petrodel Resources Limited [2013] UKSC 34, [37] and [86].
56 Amy J Amundsen, ‘Domestic Asset Protection Trusts in Divorce Litigation’ (2016) 29 Journal of the American Academy of Matrimonial Lawyers 1, 14; Turner (n 17) § 6.94; Pfannenstiehl v Pfannenstiehl 475 Mass. 105 (Mass. 2016), 55 N.E.3d 933.
57 See below, at section 3.
58 See below, at section 3.3.
59 BCFLA s 85(1)(f). Note the exception to prevent unfairness in a long marriage where the other spouse contributed to the excluded property: BCFLA s 96.
60 Matrimonial Property Act [Nova Scotia], R.S.N.S. 1989. c 275, s 4(1)(a).
61 Jesse Dukeminier and Robert H Sitkoff, Wills, Trusts and Estates (13th edition, Aspen 2013) at 703, cited in Alison Tait ‘Trusting Marriage’ (2019) 10 UC Irvine Law Review 199, 233. See also Uniform Law Commission, Uniform Trust Code § 505; American Law Institute, Restatement (Third) of Trusts (American Law Institute 2003) § 58(2) cmt E and § 60 cmt. F.
62 Tait ‘Trusting Marriage’ (n 61) 232.
63 Joshua Getzler, ‘Transplantation and Mutation in Anglo-American Trust Law’ (2009) 10 Theoretical Inquiries in Law 355.
64 Restatement (n 61) §§58(2) and 59; Uniform Trust Code (n 61) § 505(a)(2).
65 Adam Hofri-Winogradow, ‘The Statutory Liberalization of Trust Law across 152 Jurisdictions’ (2020) 53 UC Davis Law Review 2313, 2343–2351.
66 Powell-Ferri v Ferri 326 Conn 457 (2017); Matter of Merrill 2021 WL 1538884 (NH 2021).
67 RK Weisbord, ‘Trust Law’s Public Policy Doctrine: Major Policy Fault Lines, Aggressive Home Rule Legislation, and Implications for Conflicts Reform’ (2023) 97 Tulane Law Review 1147.
68 Re Armstrong (n 43).
69 Restatement (n 61) § 25, cmt e; Turner (n 17) § 6.93.
70 Lauren Ashley Gribble, ‘Justice before Generosity: Creditors' Claim to Assets of a Revocable Trust after the Death of the Settlor’ (2015) 48 Akron Law Review 383.
71 Amy Morris Hess, Bogert’s The Law of Trusts and Trustees (Westlaw, 2023) § 104.
72 Restatement (n 61) § 25.
73 Uniform Trust Code (n 61) § 505.
74 s 4(1).
75 BCFLA, s 84(3).
76 Tasarruf Mevduati Sigorta Fonu v Merrill Lynch Bank and Trust Co (Cayman) Ltd [2011] UKPC 17, [2012] 1 WLR 1721.
77 Clayton v Clayton [2016] NZSC 29, [104]-[107].
78 Compare Brkic v White [2021] NZCA 670: Higgins v Higgins [2020] NZFC 9654 and Gill v Gill [2020] NZFC 10231.
79 Da Silva v Da Silva [2016] NZHC 2064, [53] and Darlow v Raymond [2017] NZHC 269, [127].
80 See Official Assignee v Wilson [2008] 3 NZLR 45,[63]-[72].
81 Cooper v Pinney [2023] NZCA 62, [29].
82 Cooper (n 81) [54] and [68].
83 Cooper (n 81) [72] and [85].
84 Cooper (n 81) [93].
85 Cooper (n 81) [108], [110]-[111].
86 Cooper (n 81) [106].
87 Cooper (n 81) [117].
88 Cooper (n 81) [114].
89 Quote is from Re Marriage of Davidson (No 2) (1990) 14 Fam LR 817, 824. See decisions noted in Public Trustee v Smith [2008] NSWSC 397, [125] and Harris v Dewell [2018] 58 Fam LR 313, [37]-[65].
90 John Glover, ‘Discretionary Trusts, Fiduciary Duties in the Family Law Act’ (2000) 14 Australian Family Law Journal 184; Lee Aitken, ‘Muddying the Waters Further’ (2009) 32 Australian Bar Review 173. Compare with The Hon Diana Bryant AO, ‘Heterodox is the new orthodox—discretionary trusts and family law’ (2014) 20 Trusts and Trustees 654.
91 Jessica Palmer, ‘Controlling the Trust’ [2011] Otago Law Review 3.
92 Kennon (n 35).
93 Coley v Danae [2020] WASCA 13; Landry & Talford [2020] FCCA 3442; Dovgan & Dovgan [2021] FAMCA 306, [264]-[292]; Wheeler & Loggins [2023] FedCFamC1F 66.
94 Harris (n 89) [67]-[68].
95 Kennon (n 35) [65]-[66] and [69].
96 O’Hagan ‘Beneficial Powers’ (n 17) 77–78.
97 Gordon v Neilson, 2018 SKQB 207, [157].
98 Mudronja v Mudronja 2014 CarswellOnt 15112, [94]-[95]; Grosse v Grosse, 2012 SKQB 464, [28] and [53]; Shopik v Shopik, 2014 ABQB 41, [23]-[49]; See also Sarah Boulby, ‘Financial Literacy for Family Lawyers: Trusts in Family Law’ (2018) 33 Money & Family Law 51; Morgan McIntyre, ‘Trust Me, It’s Property, But What’s It Worth?’ (2019) 34 Money & Family Law 74.
99 At least in the family property context; in relation to entitlements to government benefits, see S.A. v. Metro Vancouver Housing Corp 2019 SCC 4.
100 Purtzki v Saunders 2016 CarswellBC 2151.
101 Purtzki (n 100), [40].
102 Purtzki (n 100), [41].
103 Purtzki (n 100), [68]-[71].
104 Purtzki (n 100), [74].
105 Negus v Yehia 2018 BCSC 604, [114]; HSS v SHD 2018 BCCA 199, [86]; Williamson v Williamson, 2020 BCSC 108, [37]; Gaerber v Gaerber, 2020 BCSC 2080, [61]-[68].
106 Tremblay v Tremblay, 2016 ONSC 588.
107 Tremblay (n 106) [31].
108 Tremblay (n 106) [32].
109 Tremblay (n 106) [31]-[32].
110 Tremblay (n 106), [32].
111 Tremblay (n 106) [34]-[38].
112 See cases cited in n 98.
113 Turner (n 17) §§ 6.93 and 6.94; Dahl v Dahl, 2015 UT 79, (Utah 2015).
114 Ruml v Ruml 50 Mass App Ct 500 (2000), 510–512; Restatement (n 61) § 60, cmt g.
115 Savoy v Savoy 97 Mass App Ct 1128 (2020); RB v CC No. 22-P-520 (Mass. App. Ct. 2023).
116 Kim v Kim 150 N.E.3d 1229, 2020 Ohio 22; Alvares-Correa v Alvares-Correa 726 NYS 2d 668 (2001).
117 See for example Guagenti v Guagenti 90 NE 3d 297 (2017).
118 Sharon L Klein, ‘Break ‘Em Open: Accessing Trust Funds’ (2023) https://www.aamlohio.com/documents/AAML-Ohio-Chapter-presentation-2023.pdf, 16.
119 MCA s 25(2)(a); AUFLA ss 79(4)(a) and 75(2)(b).
120 O’D v O’D [1976] Fam 83, 90. For discussion see: Lord Justice Moylan, ‘Trusts in the family courts’ (2013) 19 Trusts & Trustees 322; Nicole Chan, ‘An analysis of the risks that arise for discretionary trust settlements in the event of a divorce’ (2023) 29 Trusts and Trustees 1. A similar approach applies in Hong Kong: see Kan Lai Kwan v Otto Poon & HSBC International Trustee Ltd (2014) 17 HKCFAR 414, and Rebecca Lee, ‘The Vulnerability of Trusts in Divorce’ in Richard C Nolan, Kelvin FK Low and Tang Hang Wu (eds), Trusts and Modern Wealth Management (Cambridge University Press 2018).
121 Charman v Charman (No 4) [2007] 1 FLR 1246, [47]–[58].
122 Charman v Charman [2005] EWCA Civ 1606, [12]; Whaley v Whaley [2011] EWCA Civ 617, [112]-[114]; A v A (St George Trustees Ltd, Interveners) [2007] 2 FLR 467; Villiers v Villiers [2021] EWFC 23.
123 Charman [2005] (n 122) [12]-[13].
124 Charman [2007] (n 121) [53].
125 SR v CR [2008] EWHC 2329.
126 Charman [2005] (n 122); Whaley (n 122); SR v CR [2008] EWHC 2329 (Fam).
127 Lord Justice Moylan (n 120), 323.
128 Kelly and Kelly (No 2) (1981) FLC 91–108, [76,803].
129 Hall v Hall [2016] HCA 23, [54].
130 Dovgan (n 93), [279].
131 Dovgan (n 93), [268]-[292].
132 Dovgan (n 93), [305]-[307].
133 Essex v Essex [2009] FamCAFC 236, [172]; Kerr & Christie [2021] FedCFamC1F 313, [22]-[24].
134 Williams v Massa (2000) 431 Mass 619, 629.
135 See Bennett and Hofri-Winogradow (n 5).
136 PRA s 10; BCFLA s 85(1)(a)-(b1).
137 PRA s 9A; BCFLA s 84(2)(g).