Analysis
By her last Will and Codicils thereto Patricia Folkes appointed the First and Second Defendants, who were her solicitors, and the Third Defendant, who was her accountant, to act as executors (“Executors”). Her estate, which included a large house in substantial grounds called Stourton Hall and a holiday home at Pen-y-Graig, was left on discretionary trusts for the benefit of her three children and seven grandchildren. She also left a letter in which she said that her personal chattels at those properties had already been given to the Fourth Defendant, Constantine Folkes. She died on 20 December 2014. The Claimant, Patricia Jane Folkes issued a Part 8 claim form against the Executors on 18 July 2016. She sought their removal and the appointment in their place of an independent administrator because there were a number of transactions and documents executed by her mother during her lifetime that required investigation and she did not think that the Executors had sufficient independence to investigate them fairly, as they had been involved in some of them personally, and she thought that they favoured the Fourth Defendant and his children. The Executors, backed up by the Fourth Defendant and his children, initially defended the claim in the period up to 24 February 2017 but thereafter dropped their opposition to the application and thenceforward took a neutral stance until the hearing, for which judgment was given on 15 November 2017. On the same day Deputy Master Linwood heard submissions on costs and, in a reserved judgment given on 30 November 2017, ordered the Executors to pay the claimant’s costs for the period during which they have resisted the claim and that, since they had acted unreasonably in defending it, they were not entitled to an indemnity from the estate. He also considered that the Executors were not entitled to an indemnity in respect to the subsequent period, notwithstanding their change of position, although they were entitled to be paid their costs of that period by the Fourth Defendant and his children. The Executors appealed.
Held (allowing the appeal in part):
The Executors should have remained neutral from the outset and, in accordance with the general rule, they were liable in costs for the period during which they unsuccessfully resisted the claim to remove them and, further, they should be deprived of their indemnity in circumstances where they had acted sufficiently unreasonably to make it just to deprive them of that indemnity. However, if having unreasonably resisted an application to remove them, they changed their stance and became neutral as to the outcome of the application, any costs which were incurred by them thereafter would generally not be due to their previous unreasonable resistance and that they should not be deprived of their indemnity in respect of those costs. Thus, there was no basis for interfering with the Deputy Master’s assessment that the Executors had acted unreasonably in defending the claim but that, following their change of position, their continued involvement was due to the defence of the claim by the Fourth Defendant and his children rather than their own previous defence and that, accordingly, they should not be deprived of their reasonable costs incurred during that period.
JUDGMENT STEPHEN JOURDAN QC Introduction [1] Mr John Folkes and his wife Mrs Patricia Folkes (“Mrs Folkes”) had three children; the Fourth Defendant, Constantine Folkes, who I will refer to as “Con”, the Claimant, Patricia Jane Folkes, known as Jane Griffiths, who I will refer to as “Jane” and a third child who is not …Continue reading "Griffin v Higgs & ors [2019] WTLR 539"