Overview

In B v C, D and E in the matter of the A Trust [2009], the Royal Court was asked to set aside a trust created under the laws of Jersey on the basis that it had been established by mistake.

While this case was not the first occasion in which the Jersey courts have had to decide whether a trust has been vitiated by mistake, earlier applications that have come before the Jersey courts have concerned trusts that had English law as their proper law and, as such, the English law position on mistake was adopted. That position is reflected in the decision of Gibbons v Mitchell [1991] where the classic formulation of the test for mistake was set out:

"The deed will be set aside if the court is satisfied that the transferor did not intend the transaction to have the effect it did. It will be set aside for mistake, whether the mistake is a mistake of law or fact, so long as the mistake is as to the effect of the transaction itself and not merely as to its consequences or the advantages to be gained by entering into it."

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