Analysis
This was a claim by the claimant (C) against her brother (D) relating to the administration of the estate of their late mother (S).
S died on 30 November 2011 leaving two children: C and D. S’s will appointed C and D as executors and trustees and she gave her whole estate, upon the usual trusts for sale and conversion, to be held in trust to divide the net sale proceeds equally between C and D.
The main asset in the estate was S’s property worth in the order of £165,000 (the House). There were also capital and other investments in the order of some £108,000. The total net estate was valued at £271,134.
C had agreed that D could administer the estate, though there was dispute as to the extent to which that was on the basis that D would keep C updated on progression. D said that C was always able to ask him what was happening and until he obtained a grant of probate there was little for him to tell her. C’s solicitors wrote several letters to D, most of which went unanswered. C entered a caveat, which she acknowledged was inappropriate because there was no challenge to the will or its validity. The caveat prevented D from selling the house.
There was a proposed sale of the house to the grandson of D’s partner (A) for £165,000. C said she did not know that that was the agreed price but took no issue with it. An undertaking was suggested by a solicitor apparently acting for A to progress the sale. In evidence, it became clear that C and D differed in their understandings of the undertaking. The proposal did not work because D was not prepared to instruct the solicitor to administer the estate.
There were then warnings of the caveats and new caveats. In the meantime, A moved into the house, hoping to purchase it.
Correspondence also ensured between the parties from 2012 onwards by which C sought to resolve the matter. C suggested that C be appointed as co-executor but D refused. C said she was not happy for D to be sole executor because there were trust issues, but her son could be appointed in her place as co-executor, or alternatively D could renounce and an independent executor be appointed such as C’s son. On 18 February 2014, a letter from C’s solicitors recorded that the registrar of the Ipswich District Probate Registry had recommended the appointment of an independent administrator of the estate.
On 6 March 2014, after proceedings had been issued, C’s solicitors by email indicated that C wanted appointment of a third party independent administrator, her share of the rent from A until the sale of the house proceeded and for each party to meet their own costs from their own share of the estate. On 13 January 2015, C’s solicitors wrote asserting that there was no benefit in D pursuing the matter at court and again suggesting that D agree to be removed and agree for C to be sole executrix or for a third party to be appointed. In absence of agreement, D was invited to propose people he would be willing to appoint. Nothing came of that.
Deputy Master Cousins, as part of a refusal to grant relief from sanctions, had already made an order that there be judgment in default of defence in favour of C in respect of the order for D to account to the estate for a sum representing the market rent properly obtainable for the house for the period in which it has been occupied by A, and any interest which would have accrued upon that sum. There has been no attempt to appeal that part of the order.
D said that in the last 40 or 45 years he had only seen C about six times and hardly recognises her. D subjected C to cross-examination, the thrust of which was that she told lies.
Held
- 1) C was making sensible proposals to resolve the matter.
- 2) There had been a complete breakdown between the two appointed executors. There is a clash of personalities and a lack of confidence in each other.
- 3) C did not deliberately lie at any time, although she had to accept that she had made a clear error in a witness statement.
- 4) The two siblings do not get on and cannot work together. That is evidenced by the fact that three years on, there has been no progress of any concrete sort in the administration of S’s estate. That situation cannot be allowed to continue. C and D should therefore be removed as executors.
- 5) Regarding who should be appointed in their place, if both C and D agree, then D’s partner and C’s son should be appointed as joint administrators. If C and D will not agree, then there should be an independent solicitor appointed.
- 6) Regarding the order for D to account for rent on the house during A’s occupation, Deputy Master Cousin’s order still stands. Given the difficulties in securing the investments within the estate and the tensions between C and D, it was sensible and prudent for D to allow A to occupy the house for a period of time, paying no rent, but in return for him putting the house into a more habitable state and condition. The appropriate way of addressing the deficiencies in the house is to proceed on the footing that D acted properly in allowing A a rent-free period whilst he addressed the house deficiencies. It would be appropriate to allow A a notional rent-free period until the end of October 2012. Thereafter he should be treated as liable to pay an occupational rent from the beginning of November 2012.
7) Regarding the monthly rate that A should be treated as liable to pay, the allowance of a rent-free period should result in the court applying the higher of two alternative rental values in the expert valuer’s report. D should be charged against his share in the estate a monthly rental liability from the beginning of November 2012 at the rate of £750 per calendar month. The capital sum represented by that monthly figure should be offset against his share in the estate.
Continue reading "Wilby v Rigby [2015] EWHC 2394 (CH)"