Trusts & Trustees, Vol. 14, No. 1, February 2008 1

Editorial

AnthonyMolloy QC and Toby Graham*

Professor Maitland liked to point out that the

beginnings of the trust are discernible in a ‘slight

but unbroken thread of cases, beginning while the

Conquest is yet recent.’1 This forensic Methuselah

retains its vitality today because reams of contractual

boilerplate cannot compete with the efficiency of

equity’s default rules. These were famously expressed

by the great Chief Judge of the New York Court of

Appeals—later to become a Justice of the Supreme

Court of the United States—Benjamin Cardozo, in

Meinhard v. Salmon, 249 NY 458, 464 (1928):

Many forms of conduct permissible in a workaday

world for those acting at arm’s length, are forbidden

to those bound by fiduciary ties. A trustee is held to

something stricter than the morals of the market

place. Not honesty alone, but the punctilio of an honor

the most sensitive, is then the standard of behavior. As

to this there has developed a tradition that is

unbending and inveterate.

Uncompromising rigidity has been the attitude of

courts of equity when petitioned to undermine the

rule of undivided loyalty by the ‘disintegrating

erosion’ of particular exceptions . . .. Only thus has

the level of conduct for fiduciaries been kept at a level

higher than that trodden by the crowd.

The trust therefore constantly proves to be a ‘beauty

ever ancient, ever new.’2 This functionally elegant

English institution continues to display a phenomenal

capacity to take root wherever there is patrimony to be

protected and husbanded, and the economist’s pro-

blem of ‘moral hazard’ to be overcome.

Nowhere is this better reflected than in the contents

of this journal. This first issue of Volume 14 has

Justice Cardozo’s fellow countryman, Alexander

Bove, expounding the virtues of the USA as an asset

protection trust jurisdiction.

From North America to Central America: from

whence Glen Wilson gives us a discussion of the 2007

amendments to the framework of regulation, which

Belize imposes on International Financial Services

Practitioners.

The population of the British Virgin Islands may

only be about 25,000, but it punches above its weight in

the international trust arena. From there Chris

McKenzie discusses the legislation underpinning the

indigenous private trust.

From Israel, Gideon Koren contributes a lawyer’s

view, of how best to hold assets in that country, which

harks back to the rest of Maitland’s above observa-

tion—that relates to the utility of the trust for

smoothing the passing of assets to heirs. His fellow

countryman, Shai Dover, explains the disclosure that

the laws of Israel can require of settlors, trustees, and

beneficiaries.

Equity thrives on friction between competing

interests, and there is a fair bit of that at the

moment where fractures in domestic relationships

spill over into foreign trust jurisdictions.

From Jersey, Robert Macrae and Victoria Connolly

flag an important local decision on this friction point,

and its implications for trustees, viz In Re H Trust

[2006] JLR 280; subsequent unreported decision of

2 October 2007. And, from England, co-editor Toby

Graham, and Patrick Tolhurst, are on the same point.

In one of his last editorials, in August 2007, John

Goldsworth, expressing concern that, in Charman v.

Charman [2007] EWCA Civ 503, ‘policy was

*Anthony Molloy QC, Shortland Chambers, Auckland, Email: apmolloyqc@shortlandchambers.co.nz

Toby Graham, Farrer & Co, London, Email: tbg@farrer.co.uk

1. ‘The Origin of Uses’ (1894) 8 Harv L Rev 127, 129; Equity, also the Forms of Action at Common Law (1909) 23–42.

2. The exclamation of the fifth century Bishop of Hippo, St. Augustine, lamenting his misspent years: ‘Late have I loved Thee, Beauty ever ancient, ever new, late

have I loved Thee’ [Confessions,10:27].

� The Author (2008). Published by Oxford University Press. All rights reserved. doi:10.1093/tandt/ttm132

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preferred to argument’, predicted that ‘we will hear

much more about’ the case. Although, at paragraph

[58] of the judgment, the Court of Appeal expressly

declined to send any ‘message to the off-shore world

that, in family cases, trusts do not matter’, the

authors put flesh on John’s prediction, and question

whether the courts are sending mixed messages over

whether, in those cases, trusts matter as much as

they should.

The confusion may take time to work out. It

certainly has been taking its time to work out in

respect of applications masquerading as invocations

of what the Court of Appeal ruled in Re Hastings -

Bass (Deceased), Hastings and Others v Inland Revenue

Commissioners [1975] Ch 25. Thirty-four years after

that case was heard by the Court of Appeal, co-editor

Tony Molloy QC’s contribution risks becoming the

latest addition to the graveyard of attempted explana-

tions of the Hastings-Bass ‘‘principle’’. Hopefully, like

Voltaire’s Cacambo, in Candide, if, in his article, ‘you

don’t find anything pleasant, you shall at least find

something fresh—including the very belated first

report of the original judgment of Plowman J.’

Fourteen years ago, STEP was but a handful of trust

practitioners meeting in a small room. Neither the

International Trust and Estate Law Reports nor the

Wills and Trusts Law Reports was even a gleam in an

eye. So it was brave and prescient of John Goldsworth

to have plunged in and started Trusts & Trustees on

his kitchen table.

Matters requiring comment and analysis multiplied

exponentially. Readership grew rapidly. Production

and distribution requirements were eating into the

time available for actually doing the writing. And

John’s kitchen had became so crowded that he had

not been able to eat at home for years. In 2006,

Oxford University Press solved these problems at a

stroke, by taking over the journal.

Now, like Lycidas, setting out for ‘fresh woods

and pastures new’, John becomes Editor Emeritus.

Perhaps recognizing that he had been doing the

work of two, OUP has appointed co-editors to

succeed him. Our location on opposite sides of the

globe, and the worldwide range of sources of articles

in this, our inaugural issue, are tribute to the clarity of

the vision he expressed in his very first editorial

opinion. In Issue 1 of Volume 1, John wrote that ‘it is

only by understanding the full international implica-

tions of cross-border trusts will problems be avoided

in the growth of international trusts. One of

the purposes of this journal is to foster better

understanding of international trusts and cross-

border transactions involving trusts.’

That remains a central purpose of this journal.

We hope to maintain the wide appeal it

commands among trust practitioners around the

world. To that end, we solicit from readers articles,

observations, letters and case notes, in relation to all

aspects of the law and practice of trusts and

trusteeship.

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