Examining the nature of Henson Trusts
The Supreme Court of Canada granted leave to appeal in the case of in S.A. v. Metro Vancouver Housing Corporation, 2017 BCCA 2 (37551). The decision will examine the juridical nature of the Henson trust. A Henson trust, sometimes called an absolute discretionary trust, is a trust designed to benefit disabled persons. It protects the assets of the disabled person as well as the right to collect government benefits and entitlements. The key provision of a Henson trust is that the trustee has "absolute discretion" in determining whether to use the trust assets to provide assistance to the beneficiary, and in what quantity. The assets do not vest with the beneficiary and therefore are not used to deny means-tested government benefits. The shield that these trusts has provided has been challenged by recent decisions at the British Columbia Court of Appeal. Henson trusts have been used for several decades as an estate planning tool for families with disabled children.