© The Author (2008). Published by Oxford University Press. All rights reserved.
Form and substance: the Cayman Islands perspective in the debate about offshore trusts. Presentation to the trusts and estates litigation forum in Provence, France, February 2008
Offshore legislation seeks to keep pace with demand in many of the key jurisdictions by a clear and deliberate policy of adapting the structure to fit the need. As a result, the legitimate uses of offshore trusts for estate preservation and planning, led to a legislative agenda which was designed to ensure that each jurisdiction offered the most attractive options for meeting those objectives.
Most offshore commentators have argued that this innovation was essential for the survival of the industry after the tax authorities in the US, UK and other commonwealth countries introduced changes effectively closing the doors on offshore trust. However, some onshore detractors criticise the offshore trust as a triumph of form over substance. From the Cayman Islands' perspective, the chorus of criticism, on close examination, will be found to be baseless. The central proposition of this article is that the trust, in the Cayman Islands, has been a triumph of form and substance; that the cutting edge legislative developments find a solid foundation in the jurisprudence of the Islands.
The article begins by reviewing some of the ways in which this onshore scepticism has recently manifested itself and then turns to exploring the case law, focusing in particular on decisions of the Cayman Islands courts, which reveal the doubters to be entirely misguided, with particular reference to the approach to disclosure of information, and the likely judicial approach to assessing the validity of the trust.
Correspondence: *The Honourable Anthony Smellie, Chief Justice, Cayman Islands Judiciary, Edward Street, P.O. Box 495, Grand Cayman KY1-1106, Cayman Islands, Email: cijudges{at}candw.ky