CG37851 - Separate settlements: form of the transaction: power in wider form

In Bond v Pickford, 57TC301, the Court of Appeal held that unless the trustees used a power in wider form', they could not create a new settlement. As explained by Slade LJ at 320, Section I, trustees, who are given a discretionary power to direct which of the beneficiaries shall take the trust property and for what interests, do not have the power thereby to remove assets from the original settlement, by subjecting them to the trusts of a separate settlement, unless the instrument which gave them the power expressly or by necessary implication authorises them to do so. In the absence of such authority, any exercise of the power, other than one which renders persons beneficially absolutely entitled to the relevant assets, will leave those assets subject to the trusts of the original settlement.’