Analysis
Mr Kudlick, a chartered accountant and the defendant, was a trustee of the Marian Miller Settlement from 1973 and was later an executor and trustee of the estates of Marian Miller’s late parents, Harold Miller, who died on 29 December 1984, and Ethel Miller, who died on 26 December 1987. With his co-executor Mr Levy, Mr Kudlick was responsible as executor for the administration of the estates of the late Harold and Ethel Miller. He and Mr Levy were trustees of three trusts, the property of which comprised one-quarter of Harold’s and one quarter of Ethel’s residuary estates, together with any other property previously settled under the Marian Miller Settlement, of which Mr Levy had become a trustee in 1983. The beneficiaries of the three trusts were the same: Marian and her nieces Jemma (the first claimant) and Susannah. Mr Kudlick and Mr Levy dealt with the three trusts as one, preparing annually a single set of trust accounts. Jemma was appointed a trustee of the Marian Miller Settlement in 1998. Mr Levy retired as a trustee of the three trusts in 2015 and a solicitor was appointed in his place. Mr Kudlick ceased to play an active role in the administration of the trusts in 2017 and formally retired on 31 January 2020. Michael Alizade and George Saade (the second and third claimants) were then or later appointed as co-trustees of the three trusts with Jemma.
The claimants, as the current trustees of the trusts, in Jemma’s case also as a beneficiary, sought an order for an account pursuant to s25 of the Administration of Estates Act 1925, regarding the entire period of Mr Kudlick’s involvement as executor of the estates of Harold and Ethel and as a trustee of the three trusts. The main purpose of the account sought was to establish what had become of the assets of Harold’s estate, which had apparently included a number of properties and companies.
Held:
Dismissing the claim, retirement did not operate, as such, to discharge a trustee from the obligation to account as owed while still in office. Retirement may be a relevant factor for the court to take into account in the exercise of its discretion whether or not to order an account on the facts of the case. Mr Kudlick and Mr Levy had complied with their duties as executors to account for their administrations of the deceased’s estate but in principle the claimants were entitled to seek further information by way of an account. When considering whether to order a further account against Mr Kudlick as personal representative, the court would apply the same approach as when dealing with a trustee, Henchley v Thompson [2017] applied.
The court declined to order an account on four grounds. The delay of 28 years since the conclusion of the administrations of the deceaseds’ estates in seeking further accounts was unjustified and excessive. Due to the effects of that delay, it would be oppressive and unconscionable to order Mr Kudlick to provide a further account. Mr Kudlick, who was 89 at the date of judgment, was unwell and the burden of providing a further account would be likely to be detrimental to his health. There was no realistic prospect of any claim being brought as a result of the provision of further information now and it would accordingly be disproportionate to burden Mr Kudlick with that task.
JUDGMENT DEPUTY MASTER FRANCIS: Introduction [1] This is a claim brought under s25 of the Administration of Estates Act 1925, and under the court’s inherent supervisory jurisdiction over trustees, for orders requiring the defendant, Martin Kudlick:- a) to render an account of the administration of the estates of Harold Miller and Ethel Miller to the …Continue reading "Alizade & ors v Kudlick [2023] WTLR 795"