Mezhprom v Pugachev: bold new approach or illusory development?

The decision in Mezhprom v Pugachev has been widely discussed and is perceived as breaking new ground on the subject of sham trusts by its findings that a conventional New Zealand discretionary trust instrument did not on its face create a valid trust and that a trust was a sham even when a trustee-solicitor administered it in accordance with its terms. Both of these findings sit uneasily with established case law in the area and the laudable aim of foiling creditor-avoidance behaviour may best be achieved by other methods provided by the law.