Sham Transactions

The doctrine of sham is one that pervades the common law. This book will be the first cross-disciplinary analysis of all aspects of the sham doctrine, form its history and development to its varied practical applications. For practitioners used to working in only one area of sham, this volume allows a broader appreciation of the doctrine as it is applied in diverse legal areas, such as tenancy law, trusts, employment law and tax. These several areas are expounded by experts in their field, including both leading practitioners and distinguished scholars. Each contribution considers how key themes apply in each field, such as how the doctrine of sham is related to deceit or fraud, why the doctrine has been found to be useful and how it relates to other principles of statutory interpretation. This wide-ranging work is brought together, not only by these key themes, but by the comparative analysis of the editors, making this a substantial contribution to the understanding of the common law doctrine of sham. Cover SHAM TRANSACTIONS Copyright SUMMARY CONTENTS CONTENTS Foreword Editors’ Preface List of Contributors Table of Cases Table of Legislation Table of UK Statutory Instruments I CONTEXT AND HISTORY 1. Introduction: ‘Sham’ Transactions A. The Snook Case in Context B. The Origins of Sham Reasoning C. ‘Sham’ Transactions and the Limits to Legal Effectiveness D. Sham, Purposive Construction, and Tax Law E. Sham Reasoning: Broad or Narrow? 2. Sham: Early Uses and Related and Unrelated Doctrines A. Introduction B. Sham C. ‘Colour’ and ‘Colourable’ D. Fraus Legis and Related Doctrines E. Simulation and ‘Simulated’ F. Towards Snook G. Not Connected: Lease, Licence, and Labels H. Conclusion 3. The Judicial Doctrine in Australia A. Introduction B. Sham and Principles of Legal Construction C. Sham in the Context of Legislative Regimes D. Sham in Tax Law E. Elements of Sham in Australia F. The Policy and Law of Sham 4. Sham Transactions in the United States A. Introduction B. Corporate Tax Abuse and Judicial Uncertainty in the US C. A Study of Corporate Tax Abuse in the US Supreme Court D. Shams in Other US Legal Contexts E. Conclusion 5. Sham and Purposive Statutory Construction A. Introduction B. Norglen and Circuit Systems C. The ‘Advance’ and ‘Retreat’ in the Tax Context D. The Westminster Case E. Conclusions II SHAM TRANSACTIONS 6. Tenancy Agreements A. Applying Ordinary Principles of Private Law B. Explaining the Anomalous Cases C. The Implications of the Proposed Solution D. Conclusion 7. Trusts and Intention A. Separate Doctrine? B. Mutual Intention? 8. Trusts: A Practitioner’s Perspective A. Application of the Doctrine B. Identifying the Sham Transaction C. Identifying the Real Transaction D. Settlor’s Intention to Create a Sham E. Intention of Other Parties F. Dispositions Intended by Settlor: Enforceability Generally G. Assets Intended to be Held for Settlor: Position of Settlor H. Assets Intended to be Held for Settlor: Position of Trustees I. Assets Intended to be Held for Settlor: Position of Third Parties J. Challenges to Sham Trusts K. Conflict of Laws 9. Company Charges A. Introduction B. Legal Features of Fixed and Floating Charges that Influence Drafting Decisions C. The Development of the Agnew Approach to the Construction of Charges D. A Comparison: Extended Retention of Title Clauses E. The Relevance of Sham Reasoning to the First Stage of the Agnew Analysis F. The (Ir)relevance of Sham Reasoning to the Second Stage of the Agnew Analysis G. The Practical Significance of Sham Doctrine in the Avoidance of Floating Security H. Conclusion 10. Employment Law A. Introduction B. Employees and Workers C. The Courts’ Approach D. The Future of the Contract in Employment Law E. Conclusion 11. Piercing the Corporate Veil A. Introduction B. The History of Separate Personality and the Non-Recourse Rule C. Respecting Separate Personality D. When Will the Veil be Pierced at Common Law? E. Is ‘Sham’ Reasoning Useful Here? F. Conclusion III TAXATION AND PURPOSIVE STATUTORY CONSTRUCTION 12. Tracing the Boundaries of Sham and Ramsay A. Prologue B. Sham Transactions and Tax Avoidance Schemes C. Acquiring and Disposing of Securities for Tax Advantage D. The Relevance of ‘Intention’ E. A Legal Analysis of Mr Berry’s Arrangements F. Sham G. The Outcome 13. Sham, Tax Avoidance, and a GAAR: A New Zealand Perspective A. Introduction B. The Sham Construct C. The Sham Doctrine in a Jurisdiction with a General Anti-Avoidance Provision D. Conclusion 14. Sham in the Canadian Courts A. Introduction B. Sham as a Judicial Anti-Avoidance Doctrine in Canadian Tax Law C. Recent Moves to Expand Sham D. Discussion E. Conclusion 15. Sham, Tax Avoidance, and ‘A Realistic View of Facts’ in the UK A. Introduction B. The Ramsay Approach and a ‘Realistic View of Facts’ C. Tower MCashback D. Conclusion 16. Sham and Tax Law in Australia A. Starbucks, Transfer Fees, and Funding the Modern State B. The Decision in Raftland C. Three Reasons for Reluctance towards ‘Sham’ D. The Current Doctrine of ‘Sham’ E. A Recent Case F. Conclusions Index The doctrine of sham is one that pervades the common law. This book will be the first cross-disciplinary analysis of all aspects of the sham doctrine, from its history and development to its varied practical applications. For practitioners used to working in only one area of sham, this volume allows a broader appreciation of the doctrine as it is applied in diverse legal areas, such as tenancy law, trusts, employment law and tax. These several areas are expounded by experts in their field, including both leading practitioners and distinguished scholars. Each contribution considers how key themes apply in each field, such as how the doctrine of sham is related to deceit or fraud, why the doctrine has been found to be useful and how it relates to other principles of statutory interpretation. This wide-ranging work is brought together, not only by these key themes, but by the comparative analysis of the editors, making this a substantial contribution to the understanding of the common law doctrine of sham. This book focusses on the doctrine of sham. It draws together the varied practice of applying the doctrine of sham across the common law, including tax, trusts, company, contract, tenancy and employment law cases. It gives a cross-disciplinary analysis of all aspects, from its history and development to its varied practical applications The first work to draw together the law on shams across the broad range of fields in which it occurs including tax, trusts, company, contract, tenancy, and employment law. The book features contributions from first class scholars and practitioners, as well as incisive comparative analysis by the editors. This title draws together the law on shams across the broad range of fields in which it occurs including tax, trusts company, contract, tenancy, and employment law. The book features contributions from first class scholars and practitioners, as well as incisive comparative analysis by the editors.