Analysis
The claimant was the administrator of the estate of Nancy Elizabeth Brock (deceased) who executed a ‘homemade’ will on 22 April 2005. The first defendant was appointed as executrix. The first, third, fourth and fifth defendants were the adult children of the deceased to whom she had bequeathed ‘all the money’ immediately following a reference to the price of £100,000 to be paid for the deceased’s house at 6 Mildfield Estate, Pontypool which she had agreed to sell to the first defendant and her husband, the second defendant. In the event, the defendant later transferred the house to the first and second defendants for nil consideration on 18 July 2005. Aside from the house, the remainder of the estate was worth about £81,000. The deceased, who had moved into a care home, died in 2014. A question subsequently arose as to whether the deceased had capacity to transfer the house or whether (if she did) it was procured by undue influence. On account of the potential dispute, the first defendant did not actually prove the will and, by agreement, the claimant (who was an independent solicitor) was appointed administrator of the estate (with the will annexed) on 11 September 2015. On the advice of counsel, being concerned that he might be criticised by one or more of the beneficiaries whatever action he took or did not take, the claimant sought a Beddoe’s order to authorise him in his capacity as administrator to issue a claim against the first and second defendants to set aside the transfer of the deceased’s house. Originally, the application was not contested. However, at a hearing on 17 December 2018, the question arose whether this was an appropriate case for a Beddoe’s order since all those interested in the estate were adult and sui juris, and litigation about the lifetime transfer could properly be carried on between the defendants as substantive parties, with the claimant joined in as a nominal party so as to be bound by the decision. As a result, the hearing was adjourned and directions given for the parties to submit written submissions on the question which had been raised. It was at this point that the first and second defendants changed their position and indicated that they were now opposed to the making of a Beddoe’s order.
Held (dismissing the application):
An individual beneficiary was competent to bring any claim, vested in that beneficiary, against the estate. In contrast, claims belonging to the estate are vested in the personal representatives; in this case, the claimant. If, for whatever reason, he did not bring such a claim against one or more of the beneficiaries, the remaining beneficiaries could bring a derivative claim on behalf of the estate. Given that a budget of approximately £33,000 had been prepared for the claimant’s costs of the litigation, the making of a Beddoe’s order had the potential to cause substantial injustice as it would relieve those beneficiaries for whose benefit it was being brought from having to pay all of the costs if the claim was unsuccessful and throw the concomitant burden of having to pay a share of the costs on the (in that case successful) beneficiaries. The first and second defendants were right to submit that this was in substance a dispute between beneficiaries of the estate as to whether the house formerly belonging to the deceased was to be shared between all four beneficiaries or only one of them and her husband. It was therefore properly to be categorised as a ‘hostile’ trust dispute. Accordingly, following Alsop Wilkinson v Neary, the duly of the claimant as administrator was not to take proceedings at the risk of the estate but to remain neutral and to allow the beneficiaries to fight it out between themselves at their own risk as to costs.
JUDGMENT HHJ MATTHEWS: Introduction [1] This is my judgment on an issue (which I have called the threshold issue) which arises in relation to an application for a Beddoe order in relation to prospective litigation by the claimant against the first and second defendants. The claimant is the administrator of the estate of the late …Continue reading "Lines v Wilcox & ors [2019] WTLR 927"