Trust Parties’ Uniquely Easy Access to Rescission: Analysis, Critique and Reform

Parties to trusts currently enjoy easier access to judicial avoidance of voluntary dispositions resulting from mistakes and inadequate decision-making than other persons. The principal doctrinal basis for this advantage has shifted from the rule in Re Hastings-Bass to rescission in equity. The article argues that this advantage is normatively unjustified, and recommends a uniform legal framework to govern the avoidance of voluntary dispositions resulting from mistakes or inadequate decision-making, whether or not a trust was involved. Under this framework, dispositions resulting from laypersons’ mistakes and inadequate decision-making should be avoided, subject to appropriate defences, whenever that causative nexus is present, while dispositions resulting from professionals’ mistakes and inadequate decision-making should only be avoided where the mistake or deliberative flaw was so serious as to render the transferee's retention of property transferred unjust.