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ARTICLE · 24 JULY 2012

Guiding You Through Sham Trusts

Withers LLP
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At a time when trusts are coming increasingly under attack, it is quite common for the validity of a trust to be questioned on the basis that the instrument creating it is a sham document or fails to fulfil the requirements for the creation of a valid trust.

British Virgin IslandsWealth Management
Withers LLP
Withers LLP
Patrick Hamlin
Patrick Hamlin
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When is a sham not a sham?

At a time when trusts are coming increasingly under attack, it is quite common for the validity of a trust to be questioned on the basis that the instrument creating it is a sham document or fails to fulfil the requirements for the creation of a valid trust.

The validity of a trust may be challenged in many circumstances, for example, during a divorce, if you suspect a creditor is hiding assets or if you are a judgment debtor.

It is important to understand when a trust can be considered to be a sham and consequently be void. This guide sets out the defining characteristics of sham trusts and provides an overview of some of the issues. It does not provide definitive advice on the law. You are recommended to seek legal advice on your specific circumstances.

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