Jane Sharman Hilton & Anor v Stephen Howard Woolfe & Anor

Master Kaye:

1. John Keeling Walker died on 13 January 2002 (“ the deceased ”) leaving a will dated 24 October 2001.

2. At the time of his death, the deceased and his third wife, Violet Walker (“ Vicki ”), lived at Fairfield, Lyndon Road, Hambleton, Rutland, LE15 8BG (“ the Property ”). They held the Property as tenants in common in equal shares. Following his death, his equal half share of the Property passed to his estate to be administered in accordance with the terms of his will.

3. Under the terms of the deceased’s will the claimants (his daughters) (“ JSH ” and “ Ms Cosnier ” and together “ the claimants ”) together with Vicki (their stepmother) were appointed as executors. Vicki remained an executor until July 2023 when she was removed at an uncontested hearing. She subsequently died on 15 September 2023 aged 97. Stephen Bradshaw, her son, is her executor (“ Mr Bradshaw ”). Vicki’s estate/Mr Bradshaw are not a party to these proceedings.

4. Under the terms of the will Vicki and a Mr Ian Neal, a solicitor at Hegarty & Co, (“ Mr Neal ”) were appointed as the (original) Rutland Trustees of the will trust, the Rutland Trust. In the events that have occurred, the defendants (“ MKD ” and “ SHW ”, together “ the defendants ”) consider themselves to be the present Rutland Trustees of the Rutland Trust.

5. For these purposes, the relevant provisions of the will are set out at Clause 9 and Clause 10. In particular Clause 9 provides: “I GIVE to my Rutland Trustees all my share and interest in equity as beneficial tenant in common in the proceeds of sale and in the net rents and profits until sale of the freehold dwellinghouse and premises as Fairfield Lyndon Road Hambleton in the County of Rutland and all other (if any) my interest therein or all that my estate and interest in the dwelling which may be my main residence at the date of my death together with all garden land appurtenant thereto (hereinafter called “the Rutland Property”) upon the following trusts in accordance with the following provisions:- (A) My Rutland Trustees shall hold my interest in the Rutland Property upon trust for sale with full power to postpone the sale (B) Without prejudice to the trust for sale my Rutland Trustees shall allow my said wife [Vicki] to reside in the Rutland Property or any property which may from time to time be purchased in lieu thereof… (G) …the trusts hereof shall not benefit in any way from the effect of the reliefs and exemptions for inheritance tax purposes of which my wife’s free estate may be entitled and that any advantage of reliefs and exemptions shall not in any way accrue to the benefit of the trusts hereof.”

6. By clause 10 of the will the sum of £300,000 (“ the Cash Sum ”) was given to the Rutland Trustees to pay to Vicki the income from it for life and at Clause 10(C), a similar provision to 9(G) was included as to the benefit of reliefs and exemptions.

7. Following Vicki’s death, the net proceeds of sale of the Property, and the Cash Sum, were to be held by the Rutland Trustees upon the trusts in Clause 12 of the Will, i.e. for the claimants in equal shares absolutely.

8. The Rutland Trust was therefore a life interest trust to enable Vicki to continue to live in the Property during her lifetime and to provide her with income. Background

9. Probate was granted to the claimants and Vicki on 30 August 2002. The grant was extracted by Hegarty & Co. The value of the estate was stated to be £865,000 gross and the net value of the estate was stated to be £857,776. The probate value of the deceased’s interest in the Property was £300,000.

10. Mr Neal disclaimed his role as a Rutland Trustee on 1 October 2002. The deed of disclaimer describes him as the Disclaiming Trustee and Vicki as the Remaining Trustee. He was no longer prepared to act. The defendants say that he explained that this followed accusations made against him including complaints to the Law Society and the Legal Services Ombudsman about his firm Hegarty & Co. The defendants understand that it was JSH who made the complaints. Certainly JSH makes it clear in her evidence that she considered that Mr Neal had a conflict of interest and had prioritised his role in relation to the Rutland Trust over his duties to the executors. I do not know what the outcome of the complaints were but clearly the relationship was not harmonious.

11. The defendants record what they describe as challenging behaviour by the claimants over the period from 2002. They say they have themselves experienced hostility from the claimants. They explain that Vicki was frightened of the claimants and found them to be overbearing and bullying. JSH does not accept this characterisation of her behaviour. However, it is about how that behaviour was experienced by others.

12. Certainly, her approach to this claim and the tenor and content of her witness evidence suggests that she has firm and robust views about what she considers to be the right answer to the issues and is resistant to any contrary view.

13. Following the deceased’s death there were discussions about a possible agreement to vary the provisions of the will. No such agreement could be reached before the second anniversary of the deceased’s death to enable a potential amelioration of inheritance tax.

14. Whilst negotiations appear to have continued no agreement was reached. From late 2007 Vicki took the following steps: i) By a transfer dated 18 November 2007 (“ the Transfer ”) Vicki, the sole legal owner of the Property following the deceased’s death, transferred the Property to herself and the defendants for no consideration to hold the Property upon and subject to the trusts of the will. ii) Two deeds were then executed on 17 January 2008: a deed of appointment by which Vicki as the sole remaining Rutland Trustee appointed the defendants as Rutland Trustees with Vicki pursuant to section 36 of the Trustee Act 1925 (“ the DOA ”); and a declaration of trust (“ the DOT ”) by which Vicki and the defendants were declared to hold the Property as to half for Vicki absolutely and the other half on the trusts declared in the will. The DOT included a provision to transfer the Property to the defendants and Vicki as tenants in common, but by then the Transfer had already been executed (“ the Property Trust ”).

15. Vicki continued to live in the Property rent free from 2002 until her death at 97 in September 2023.

16. The defendants say that they do not know what steps the claimants actually took in relation to the administration of the estate but that the figures set out in the grant of probate show that there ought to have been no difficulty in the transfer of the Cash Sum to the Rutland Trustees.

17. JSH says that the difficulties in administering the estate were caused by Vicki’s refusal to engage with the claimants properly and have meetings with them. However, the defendants explain that it was the claimants’ conduct that was the cause of the issue. For example, SHW explained to JSH in October 2011 that as a result of the aggressive tone of her letters, Vicki was unwilling to attend a meeting and that the defendants could not see what a meeting was likely to achieve.

18. From 2008 onwards engagement between the claimants and the defendants was sporadic. The defendants did call for the Cash Sum. The Cash Sum was not paid over and it appears that no income was paid to Vicki. JSH did not recognise the defendants as the Rutland Trustees nor did she recognise the Rutland Trust. This remains her position in these proceedings.

19. MKD explains that although Vicki considered taking action, she was concerned about the impact JSH’s aggression would have on her health. Vicki was by this stage in her 80’s. Vicki continued to resist taking action to enforce any rights and or to remove the executors throughout the period despite having obtained advice about that course of action for fear of antagonising JSH. Whether JSH considers it a fair characterisation of her behaviours is not the issue. It was how Vicki perceived them which evidence is provided to explain why no directions were sought from the court by Vicki or the defendants at an earlier stage.

20. Equally despite the apparent difficulties in the relationship and JSH’s complaints that the administration of the estate was delayed as a result of Vicki’s behaviour and failure to engage, she did not herself take any steps to remove Vicki as executor until 2023.

21. JSH relies on correspondence from the defendants in 2008 and 2011 to support her contention that they were not and knew they were not the Rutland Trustees. i) On 12 September 2008 JSH says that MKD wrote to JSH in terms that referred to the fact that the defendants (and Vicki) were waiting for an assent and a transfer of the Cash Sum. ii) On 6 October 2011 SHW appears to agree that he was not yet a Rutland Trustee and that the defendants will not be until the administration of the estate has been concluded and funds have been appointed to the Rutland Trustees. However, SHW does in this letter specifically question why the income from the Cash Sum has not been paid to Vicki. He suggests that independent administrators be appointed and highlights the potential liability of the Rutland Trust for inheritance tax on Vicki’s death.

22. The short answer to JSH’s reliance on this correspondence is that the question to be determined is whether as a matter of law the defendants were the Rutland Trustees. If they are then it does not matter what SHW or JSH thought the true position was whether in 2008, 2011 or now.

23. JSH continued to assert that the defendants were not the Rutland Trustees and further that the DOA and DOT were void. However, Vicki continued to live in the Property rent free consistent with a life interest trust.

24. In 2016 JSH proposed that the Cash Sum be held in an account and that Vicki be paid the interest going forwards with the balance of funds to be released to the claimants. She said that in the absence of agreement that proceedings would be issued which would include Vicki having to attend for cross examination about her conduct. There was no suggestion that the Cash Sum was needed for estate purposes and could not be used to provide income for Vicki as intended by the will. Indeed the proposal to release the balance of the relevant fund to the claimants does not suggest that the estate had any outstanding liabilities for which the Cash Sum might be needed. A clear indication that there was no need to retain the Cash Sum any longer. There does not seem to be any reason not to have transferred it to the Rutland Trust.

25. In 2018 William Sturges were instructed by Vicki and Mr Bradshaw in relation to the issues with the administration of the estate and receipt of income from the Cash Sum. They continued to represent her thereafter and now represent her estate.

26. On 30 July 2020 the first claimant registered a restriction against the title to the Property.

27. In 2022 the balance of the cash held in the executors account was £535,618.63. No up to date figures have been provided by JSH either at the time of Vicki’s death or now. Nonetheless as set out above it does not appear that there would have been any risk to the estate in distributing the Cash Sum if not earlier then in 2022.

28. The claimants applied to remove Vicki as an executor of the estate and obtained that order in July 2023. One of the reasons advanced was that Vicki was stopping them from progressing the administration of the estate. William Sturges, Vicki’s solicitors, say that she agreed to be removed at the age of 97 following years of stress and anxiety in respect of the situation with the estate of the deceased. As MKD notes, the removal of Vicki did not result in the payment of the Cash Sum.

29. JSH says that the deceased’s estate has not yet been fully administered because until Vicki was removed as executor it was not possible for example to amend share certificates into the names of the claimants. JSH does not say that this created a significant block on the ability of the claimants to administer the estate such that the Cash Sum could not be distributed and indeed as set out above she was content to ring fence it and pay Vicki the income in 2016.

30. Vicki died on 15 September 2023. The dispute about whether the defendants are the Rutland Trustees pursuant to the DOA dated 17 January 2008 and/or whether the Rutland Trust has ever been properly constituted crystallised with her death.

31. On 1 December 2023 JSH wrote to SHW asserting that the defendants were not and never had been the Rutland Trustees. She asked them to step down as trustees of the Property Trust.

32. Following Vicki’s death, MKD received demands from HMRC for payment of inheritance tax relating to the Rutland Trust. The defendants are therefore concerned that they may end up with personal liability to pay the tax in relation to the Rutland Trust as Rutland Trustees including interest and penalties.

33. JSH did not and does not accept that the Rutland Trust came into existence so considers that any inheritance tax is payable by the estate. She appears to have sought to file inheritance tax returns on that basis though there appears to be concern between the parties as to how she may have treated the Cash Sum. This concern arises precisely because there is a dispute about the existence of the Rutland Trust.

34. It is notable however that no inheritance tax was paid on the testator’s death in 2002 in respect of the Property and that appears to be more consistent with the existence of the Rutland Trust.

35. On 14 December 2023, SHW wrote to the claimants setting out various options as to the way forward (“ the 14 December 2023 letter ”). JSH relies on this email as providing the defendants’ agreement to retire and a binding solicitors’ undertaking to do so. It is a centrepiece of the claim. It did no such thing. It is a concern that someone who relies on her experience/background as a barrister felt able to advance her claim on that basis. Instead, it provided three options to be considered between the parties to enable them to move forwards: “Way forward In terms of enabling the parties to progress matters, Mark and I would suggest 3 possible proposals for you and Jacqueline to consider to seek to resolve this matter. Option 1

1. You and your sister agree to remove the restrictions and allow the Rutland Trustees to sell the property now in consultation with all beneficiaries (i.e. you, Jacqueline and Steve Bradshaw). As the legal owners, we do not require probate or clearance from IHT to sell the property. We would do that through agents agreed with all the beneficiaries. We had thought Savills would be regarded as a very appropriate and reputable choice. However if all the beneficiaries are not happy with that selection, and we recognise that it is important that all the beneficiaries have confidence in the agent, then please provide us with your alternative proposals and we can put this to Steve and Jacqueline. Upon the sale, the Rutland Trustees will discharge the IHT liability and the trustees’ costs from the Rutland Trust’s share of the net proceeds of sale and then distribute the balance of the funds to you and Jacqueline. The Rutland Trust will then be wound up. Option 2

2. Mark Dunkley and I will retire as trustees of both trusts and appoint:- 2.1 You and your sister as trustees of the Rutland Trust. But we would require from you, a Deed of Indemnity on a joint and several basis under which you assume, fully and appropriately in accordance with your duties, as replacement Rutland Trustees, all liability to declare fully that a full account of the Trust assets at their open market values at Vicki’s death to HMRC and pay all IHT and interest arising with a requirement that you confirm to us by letter that a full schedule of assets has been submitted to HMRC. 2.2 As far as the property trust is concerned we would appoint you, your sister and Steve Bradshaw (or his nominee) as the new trustees Option 3

3. You and/or Jacqueline put us in funds now to pay the IHT liability arising on the assets of the Rutland Trust including its 50% share in the property and the sum of £300,000 bequeathed by clause 10 of your father’s Will together with our costs. We can then wind up the Rutland Trust and will then transfer the property as in 2.2 above Next steps In setting out the detail and the various proposals above, we have tried to be constructive and put forward practical solutions. If you wish to see a speedy and a cost effective conclusion to this matter I am sure you will agree that Options 1 or 2 presents the most effective way forward. Given that the Rutland Trustees have a duty to ensure that Inheritance Tax is paid, and interest will soon start to accrue. If an agreed solution cannot be reached, then we may have no option but to apply to court for directions. This will again be costly and add to the delay.”

36. This appeared to me to be a sensible and measured proposal for discussion but did not amount to a binding agreement for any particular course of action and certainly did not include a solicitors’ undertaking to take a particular course of action. It made clear that the defendants were willing to retire provided that they had suitable indemnities including in relation to their fees and expenses and any tax liabilities. That remains their position.

37. JSH is highly critical of the defendants for not having done what she considered they had undertaken to do. She says that it is the defendants that have caused difficulties and delays and frustrated her in finalising the administration of the estate. For their part, the defendants consider that JSH’s behaviours are the cause of the delays and have found her approach to be hostile.

38. As the claimants do not accept that the Rutland Trust has been established there was an impasse in relation to the type of indemnity that might be suitable and to which the defendants might be entitled on retirement. JSH’s position in relation to the Rutland Trust and the defendants’ concern about how the assets of what they consider to be a properly constituted trust might be accounted for has also resulted in a difference of opinion.

39. Both the claimants and the defendants had indicated they were considering making claims during this period, but it was not until May 2024 that letters of claim were exchanged.

40. There were slight delays on the part of the defendants in responding to JSH’s subsequent correspondence due to SHW’s serious health issues. JSH knew about those health issues but does not appear to have made any reasonable allowances for them. The defendants agreed that MKD would take the lead going forwards. There was an unfortunate hiatus whilst SHW was in hospital and emails to MKD seem to have gone into a spam folder.

41. On 21 May 2024 JSH sent a letter of claim and draft claim to the defendants. Although the claim is dated 27 May 2024, it was supported by the first witness statement of JSH signed on 28 May 2024 (“ JSH 1 ”), and the claim was filed on 29 May 2024 and then served on the same day. Meanwhile, on 27 May 2024 MKD had sent a letter of claim to the claimants by email. The defendants’ letter of claim identified nine issues that they considered needed to be determined by the court. Those issues were subsequently set out in the first witness statement of MKD dated 14 June 2024, (“ MKD 1 ”) and are the subject of MKD’s application dated 29 November 2024 seeking to determine the nine questions set out in MKD 1 pursuant to CPR 8.7 (“ the Counterclaim Application ”). JSH therefore had received the letter of claim identifying the issues which the defendants considered needed to be determined before issuing her claim. She nonetheless advanced her claim without it appears pausing to consider whether there might be a more proportionate approach consistent with the overriding objective.

42. If the Rutland Trust was properly constituted, then it will have a significant tax liability following Vicki’s death due to the increase in the Property’s value since 2002 and the need to account for the Cash Sum even if it has not yet been paid into the Rutland Trust.

43. Savills valued the Rutland Trust’s half share in the Property immediately before Vicki’s death at £740,000. The Rutland Trust will therefore have a significant liability to tax subject to the availability of reliefs and exemptions and the effect of Clauses 9(G) and 10(C) of the will. Whilst the first claimant does not accept that any assets have been assented to the Rutland Trust and so it has not been constituted, HMRC have made direct demands to the second defendant for the inheritance tax. The total tax payable appears to be £318,195.54, attributable as to £91,787.18 to the Cash Sum and £226,408.37 as to the Property. Interest will accrue on the unpaid sums.

44. JSH says that inheritance tax is payable by the beneficiaries resulting from the death of the life tenant (Vicki) which the defendants say is only consistent with an acceptance by JSH that the Rutland Trust exists. JSH is clear that she agrees that Vicki’s life interest has now ended and the claimants are now absolutely entitled and consequently the determination of the issue of whether the defendants were the Rutland Trustees was purely academic. I do not agree. If the Rutland Trust was constituted the obligations of the Rutland Trustees do not disappear simply because Vicki has died.

45. If the defendants are Rutland Trustees and retire without a suitable indemnity or security, they are at risk in relation to the tax liabilities of the Rutland Trust and may be at personal risk of being pursued.

46. JSH had formed a view about the legal position in relation to the Rutland Trust and the Rutland Trustees which she sought to maintain. She may have considered that it would provide some benefit to the claimants in due course following Vicki’s death if they were able to say the Rutland Trust had not been constituted.

47. It seems to me that the breakdown in the relationship between Vicki, the defendants and the claimants will have caused them all to incur costs, time, and expense unnecessarily over a period of 22 years. And it may be now, as it often is, that the real issue has become the costs and expenses caused by that poor relationship.

48. This claim demonstrates the dangers of not engaging constructively. What was needed was directions from the court under CPR 64 if the parties were unable to reach agreement. There is no advantage to being the party who issues the claim if the claim does not encapsulate the issues that the court needs to consider. That is rarely a sensible course and even less so where the court has a supervisory role in relation to estates and trusts. It is simply the wrong approach. The Claim:

49. The claimants issued this claim by Part 8 claim form on 29 May 2024 (“the Claim”). The claim was supported by JSH 1.

50. The premise of the claim is that the defendants are not the Rutland Trustees and lack standing because the Rutland Trust never came into existence there having been no assent in writing of any asset to the Rutland Trust. The claim therefore does not acknowledge the existence of the Rutland Trust nor does it seek any directions from the court about whether the defendants are the Rutland Trustees. Instead its focus is the Property Trust.

51. In summary the claim seeks: i) The defendants’ retirement as trustees of the Property Trust; ii) Transfer of the Property to the claimants and Stephen Bradshaw; and iii) An order that the defendants abide by a solicitors’ undertaking to retire given in the 14 December 2023 letter.

52. The defendants consider they are the current Rutland Trustees. They are aligned in their willingness to retire as trustees of the Property Trust and the Rutland Trust. However, they require a suitable indemnity or security in relation to both trusts. The reasonableness of the indemnities which the defendants seek depend on whether they are Rutland Trustees and whether the half share in the Property or the Cash Sum are assets of the Rutland Trust. This will affect the nature of their rights and obligations including in relation to the incidence of inheritance tax in respect of the deceased’s share in the Property and the Cash Sum. The defendants say that they want to protect themselves against the risk of personal liability (including in relation to any tax) and that the indemnities should also cover expenses.

53. Their personal circumstances are different. SHW had an aggressive cancer and was very unwell, to the claimants’ knowledge, throughout 2023 and 2024. Although therefore SHW had until more recently taken the lead with the claimants, MKD has now taken on that role particular in relation to this claim.

54. The defendants filed acknowledgments of service. MKD filed and served MKD 1 in response to the claim. SHW’s witness statement was dated 27 June 2024 (“ SHW 1 ”). By application dated 24 June 2024 SHW had sought relief from sanction for the late filing of SHW 1. An order was made on paper on 2 December 2024 granting that relief.

55. At [70] and [71] of MKD 1, MKD set out nine issues in respect of which the defendants sought directions from the court. These were the same nine issues identified in the defendants’ letter of claim dated 27 May 2024. He explained they would have been the subject of a claim for directions under CPR 64 if the claimants had not issued their claim first. The defendants sought permission to counterclaim for this relief pursuant to CPR rule 8.7. The issues identified in MKD 1 were: i) Whether the defendants are the trustees of the Rutland Trust. ii) What property is held by the defendants, and subject to what trust(s)? iii) Subject to the answer to Issue (2) above, whether the claimants, as executors, should be compelled to assent the property and/or the Cash Sum to the Rutland Trustees? iv) Whether the Rutland Trustees are responsible for meeting the Rutland Trust's tax liabilities arising on Vicki’s death? v) The meaning and effect of clauses 9(G) and 10(C) of the Will, should there be any controversy as to the same. vi) Whether, in the absence of agreement, the defendants’ costs and expenses may properly be deducted from the assets of the Rutland Trust. vii) Whether the property should be sold by the defendants. viii) Whether the 2020 Restriction should be removed. ix) Whether the claimants should provide estate accounts to the Rutland Trustees.

56. JSH did not agree that any of the issues raised by MKD needed to be determined at all let alone in this claim. Her position was and remains that the Rutland Trust has never come into existence. As a consequence, she did not agree to the proposed application and considered that the defendants had no viable defence to the claim.

57. Consistent with that view JSH issued an application for summary judgment and/or strike out against the defendants on 23 July 2024 (“ the Application ”). It was supported by her second witness statement dated 22 July 2024 (“ JSH 2 ”).

58. The Application sought: i) an order directing the defendants, as trustees, retire pursuant to s.19 of the Trusts of Land and Appointment of Trustees Act 1996 (“ TOLATA ”) following a direction by the claimants, as beneficiaries, to the defendants that they retire; ii) summary judgment pursuant to CPR 24.3; and iii) strike out of the defendants’ statements of case pursuant to CPR 3.4(2) (a) (b) and (c).

59. Central to the Application was JSH’s assertion that the defendants had agreed to retire unconditionally and had given an undertaking to do so in the 14 December 2023 letter. They could therefore have no defence to her claim.

60. The Application was listed for hearing on 16 December 2024.

61. MKD issued the Counterclaim Application to determine the nine questions set out in MKD 1 which was also listed for hearing on 16 December 2024.

62. The evidence in support of the Counterclaim Application and in response to the Application was contained in his second witness statement dated 4 December 2024 (“ MKD 2 ”). SHW’s second witness statement in support of the Counterclaim Application and in response to the Application was dated 3 December 2024 (“ SHW 2 ”).

63. JSH responded to this evidence in her third witness statement dated 10 December 2024 (“ JSH 3 ”).

64. Payne Hicks Beach were instructed on behalf of the claimants in December 2024 (“ PHB ”). On 13 December 2024, the parties agreed by consent to adjourn the hearing on 16 December to enable them to seek to reach a settlement. No settlement was reached. The Application and the Counterclaim Application were relisted. This was that hearing.

65. The claimants had until shortly before the hearing refused to consider any form of indemnity that provided the defendants with an indemnity in relation to the Rutland Trust. On 19 May 2025, PHB provided a revised form of indemnity which appeared to acknowledge that the defendants were the Rutland Trustees, but it came with caveats seeking to reserve the claimants’ rights to contend that the defendants were not the Rutland Trustees. Subsequent queries raised by MKD had not been answered by the time of the hearing and no resolution had been reached. Although SHW was in principle satisfied with the open version of the deed of appointment, retirement and indemnity, he shared the concerns expressed by MKD and also needed the position in relation to the trustees’ costs and expenses to be resolved.

66. Although JSH was unrepresented when the claim was issued, PHB did not amend/modify or step back from the full extent of the Application as advanced or the resistance to the Counterclaim Application prior to the hearing.

67. And although JSH was unrepresented until December 2024, she consistently describes herself as a barrister and has done so in each of her witness statements. On 1 December 2023 she explained “ I am a barrister who has specialised in tax I do not require your assistance in any of these matters ”. On 4 March 2024 she said, “ I cannot as a barrister acknowledge and accept as true a set of facts knowing they are both legally and factually false ”. MKD’s solicitors’ enquiries of the Bar Council suggest that JSH has been an unregistered barrister since 1 January 2010. This was raised in MKD 2. JSH did not address it in JSH 3 and still described herself as a barrister. Whether she should hold herself out as a barrister is a matter between her and the Bar Standards Board. But in so far as she has until recently advanced the claim as an unrepresented party I take into account that she has held herself out as being a barrister and/or a barrister who had specialised in tax.

68. Whilst there is no different set of rules or expectations in relation to the conduct for unrepresented parties including the requirement to comply with rules and practice directions, in some cases there might be some latitude at the edges if the nature of an application or the law involved is particularly complex. Here JSH has held herself out as having specialist legal knowledge relevant to the claim that she has chosen to advance. That will impact on what if any latitude she should be given in relation to her approach and conduct of the proceedings.

69. JSH has advanced this claim on behalf of both claimants. In her correspondence before and after the issue of the claim she frequently says she writes on behalf of Ms Cosnier as well. She has not always obviously copied in Ms Cosnier. In paragraph 40 of JSH 1 she explained “ The Second Claimant authorises the First Claimant to make this witness statement and relies upon the evidence that is set out herein in support of the application. ” This or similar wording is used at the end of each of Ms Hilton’s witness statements, but there is no witness statement to that effect from Ms Cosnier so it is not clear what her position is. Although the defendants’ solicitors have sent documents to Ms Cosnier, she does not appear to have engaged in this claim despite being a named claimant. The Hearing: The Application:

70. The defendants’ position was that the Application should be dismissed with costs and that the court should grant the Counterclaim Application and permit them to advance the counterclaim. The court should then determine at least the first issue - whether the defendants are the Rutland Trustees.

71. The claimants did not concede the Application but rather their counsel sought to submit that the question of whether the defendants were Rutland Trustee arose on the Application because the defendants had raised it in the evidence in response to the Application.

72. I have read Mr Adams’s written submissions with care. They did not address the framework for the strike out and summary judgment application and made no submissions in relation to any part of the Application as advanced by the claimants. The Counterclaim Application was listed to be considered subject to the outcome of the Application. If the Application were unsuccessful the court would be considering whether to allow the defendants to advance the counterclaim and what directions to give for its future conduct. It was not before the court for determination of any of the issues raised by it.

73. Despite the clear and unambiguous evidence of JSH including her assertion at JSH 2 [4] “The Defendants statements of case raise issues which are unrelated to the Claim, incoherent and cannot amount to a defence.” and the way in which the Application was advanced Mr Adams sought to argue that whether the defendants were Rutland Trustees was always implicitly in issue. Whilst that was always the defendants’ position that was not the claim advanced by the claimants nor the way in which the Application was advanced. The focus of JSH’s evidence was that the defendants had agreed to retire and/or had given a solicitors’ undertaking to do so and should be held to it. This was based on, what is at best, a mischaracterisation of the 14 December 2023 letter as set out above and would have been bound to fail.

74. Mr Adams made no submissions at all in relation to the s.19 TOLATA or strike out elements of the Application.

75. He sought to argue that a determination of whether the defendants were Rutland Trustees could be shoehorned into the summary judgment part of the Application because the defendants had put it in issue in their responsive evidence. He argued that his submissions were clearing off the defendants’ claim to a beneficial interest. The defendants did not claim any personal beneficial interest; they claimed to hold the deceased’s share in the Property on the terms of the Rutland Trust as the Rutland Trustees.

76. This fundamentally undermined the Application as advanced. If JSH now accepted that the question of whether the defendants were the Rutland Trustees had to be determined then there was a real prospect of defending the claim as advanced and/or there was a compelling reason why the claim should not be disposed of summarily.

77. Mr Adams argued that the defendants were not the Rutland Trustees but only trustees of the Property Trust and sought a declaration that the defendants were never the trustees of any of the deceased’s property through the Rutland Trust and were therefore strangers. He submitted that the only issue for the court to determine was to whom to transfer the legal title to the Property.

78. He therefore sought an order that I direct the transfer of the legal title into the joint names of the claimants and Mr Bradshaw. However, Mr Bradshaw/Vicki’s estate are not a party to this claim and on the basis of the evidence available it appears that Mr Bradshaw does not agree with the claimants’ proposal. Since half of the Property falls into Vicki’s estate his views as to who should hold the legal title and how is a factor the court would have to take into account before making any order in relation to the Property Trust. The claimants rely on an email dated 4 March 2024 from William Sturges who confirmed that in the event of the current trustees retiring Mr Bradshaw should be noted as a registered proprietor with the new trustees.

79. On 30 April 2024 William Sturges confirmed that Mr Bradshaw considered that the sale of the Property should be conducted by the defendants as the Property was registered in their name as the Rutland Trustees at HMLR.

80. However, MKD 1 explains that on 13 June 2024, William Sturges confirmed that Mr Bradshaw resisted the Claim and agreed that the issues raised by the Counterclaim needed to be determined. This was confirmed by an email dated 13 June 2024. More recently on 27 November 2024 Hazel French of William Sturges explained “ I have been informed by Stephen Bradshaw that in view of the extremely difficult relationship over several years between [JSH]and [Vicki] he adamantly does not wish the Rutland Trustees to be replaced by [the claimants] ”. JSH’s response is to reject Mr Bradshaw and Ms French’s account and to urge the transfer into the joint names of the claimants and Mr Bradshaw. This simply highlights the caution with which the court should approach the proposal to transfer the legal title of the Property into joint names in the absence of Mr Bradshaw and without his agreement.

81. In the absence of Mr Bradshaw having an opportunity to explain Vicki’s estate’s position I am not persuaded that even if I were otherwise to determine that the legal title of the Property should be transferred that I could or should direct such a transfer now on the terms proposed by Mr Adams. In any event it would only arise if I were to summarily determine the claim in favour of the claimants. If I do not summarily determine the claim there will be time to consider the appropriate course by agreement or otherwise.

82. The defendants each argued that Mr Adams had addressed none of the issues raised in the Application and that not only should the Application fail but so should the claim.

83. Ms Palser addressed the Application as against SHW in her written and oral submissions. I have read her submissions with care and have taken them into account. Mr Moffett for MKD responded to the Application in his skeleton argument but did not make any oral submission on the basis that he said it had not been advanced by Mr Adams. Again, I have read his submissions with care and taken them into account. Unlike Mr Adams both Ms Palser and Mr Moffett referred me to the relevant legal principles and explained why they said the Application was bound to fail.

84. Ms Palser acknowledged that under s.19 TOLATA the claimants were in a position to seek the retirement of the trustees and had sought to do so. However, she submitted that their entitlement to any property the subject of the trust would be subject to deductions for inheritance tax, interest, penalties, the defendants’ costs and the potential claim by Vicki’s estate and that s.19 TOLATA provide protection for the defendants. They were not required to retire unless reasonable arrangements had been made to protect any rights they had in connection with the trust.

85. Mr Adams made no submissions in relation to the strike out part of the Application either. This aspect of the Application should have been abandoned long before the hearing. For the purposes of CPR 3.4(2) witness statements were not statements of case. The entire premise for this part of the Application was misconceived.

86. JSH’s reasons for striking out the witness statements were (i) that they were filed and/or served late and/or (ii) that MKD 1 set out his evidence about her conduct with which she did not agree and/or (iii) raised the counterclaim which had no reasonable prospect of success and was not in issue in the claim.

87. The attempt to strike out SHW 1 and MKD 1 was misconceived, opportunistic and inconsistent with the overriding objective and the court’s expectation that parties will comply with their duty to assist the court and cooperate. It should never have been advanced.

88. JSH sought to strike out SHW 1 on the basis it was said to have been served late. The application for relief from sanctions had been issued a month before the Application. The basis for the late service and seeking the first extension was entirely reasonable and should have been consented to. An order was subsequently made on paper.

89. MKD had also reasonably sought a first extension of time in time which should have been granted, not ignored. MKD 1 was filed at court in time on 14 June 2024 and emailed to the claimants. The claimants do not accept service by email so service was not effective. MKD 1 was not therefore formally served until a hard copy was received a few days later. JSH has engaged with the defendants by email throughout this claim. There was no conceivable prejudice to her in receiving MKD 1 by email on time and then receiving the hard copy a few days later particularly when she should have agreed to the first extension of time sought without the need for an application or order.

90. In so far as it might be said that there was a breach of CPR 32.10 requiring relief any such breach was neither serious nor significant but, in the circumstances, entirely trivial. Had MKD sought an extension before or after filing and serving MKD 1 it would have been granted as a first extension on paper and in so far as relief were required that too would have been granted as it was for SHW. Relying on the delay as a basis to strike out MKD 1 was not only entirely hopeless but entirely opportunistic and exactly the type of conduct which the court guards against.

91. The attempt to strike out MKD’s witness statement as an abuse of process arose because JSH considered that MKD’s references to what he considered to be her unreasonable conduct were scurrilous and ill-founded. This again was entirely misconceived. The statement represented MKD’s evidence of fact based on how he perceived her conduct for the reasons he has given. She may not agree with him but that does not mean that she can strike out the witness statement.

92. The summary judgment part of the Application overlaps with aspects of the other grounds for strike out. Ms Palser argued that the defendants’ counterclaim and evidence raised serious questions that needed to be determined, in particular the question of whether the defendants were the Rutland Trustees (as was acknowledged by Mr Adams) so it could not be said that the defendants did not have a real prospect of defending the claim. Further she submitted that the counterclaim itself was a compelling reason why the Claim could not be resolved summarily. I agree.

93. In fact the basis for summary judgment was primarily that the defendants had agreed to retire and had given a binding solicitors’ undertaking to do so and should be held to that agreement. This it was said meant that they could not have any defence to the claim. That was entirely misconceived and it is difficult to understand how JSH could have conceivably had understood the 14 December 2023 letter to either be providing either an unconditional offer to retire or a binding solicitors undertaking. Her evidence on this issue was misleading.

94. Additional parts of the summary judgment application were that the Rutland Trust had never been set up because there was no assent of the Property and that any trust ended with Vicki’s death as well as the s.19 TOLATA point.

95. Mr Moffett addressed these on the basis that not only does MKD consider them to be wrong but the evidence advanced by the defendants in response overcame the threshold for summary judgment in that their disagreement with the claimants’ position could not possibly be said to be fanciful.

96. It seems to me beyond doubt that the Application as advanced was always a hopeless application. Whilst JSH may not agree with the defendants she knew before she issued the claim and well before she issued the Application that there were serious issues to be determined in relation to the status of the defendants which were not suitable for summary determination. The serious issues to be determined whether in response to the claim or by way of counterclaim plainly overcome the low bar and have a more than fanciful prospect of success. They are plainly arguable.

97. The Application is dismissed. The Counterclaim Application

98. All the parties need the court to determine whether the defendants are the Rutland Trustees.

99. It seems to me that the differences between the claimants, the defendants and potentially Vicki’s estate are such that the only sensible way forward is to give permission for the defendants to advance their counterclaim.

100. The parties asked that I determine whether the defendants were Rutland Trustees and, in that context, also made submissions on whether there had been any assent of assets to the Rutland Trust. Counterclaim: Issue 1: Whether the defendants are the trustees of the Rutland Trust

101. The claimants say that apart from being the registered legal proprietors of the Property in respect of the Property Trust, the defendants are strangers. They have no interest and no role in relation to the assets of the deceased. They are not Rutland Trustees, because the Rutland Trust was never established by an assent of any property to either of the original Rutland Trustees named in the will or to the defendants.

102. Mr Adams sought to sidestep the shortcomings in the Application itself by advancing his submissions as being based on the standing of the defendants. He submitted that the correct analysis was that the defendants were bare trustees of the legal title to the Property under the Property Trust only and not Rutland Trustees.

103. He argues that following Vicki’s death it is the claimants and Mr Bradshaw who have the obligation to pay any liabilities that arise in relation to the Property. The defendants therefore have no liabilities to be concerned about, and the court can simply order the transfer of the legal title under the Property Trust. There is no need for any protection or indemnity. They do not hold any property on the terms of the Rutland Trust and so have no entitlement to and do not need any indemnities or protections and have no entitlement to recover any costs or expenses for administering the Rutland Trust.

104. He argues that Vicki had only ever been a prospective trustee. The absence of any assent to Vicki as the prospective Rutland Trustee of the share in the Property or the Cash Sum was fatal. There was nothing to appoint the defendants to in 2008 when Vicki purported to enter into the DOA. Vicki died before any assent by the executors to her in her capacity as Rutland Trustee.

105. Further he argues that any assent of the share in the Property would have to have been in writing and express pursuant to s.36 Administration of Estates Act 1925 (“ AEA 1925 ”). In the absence of an express assent in writing, Vicki did not, in her capacity as prospective trustee, obtain any vested interest in the Property or the Cash Sum.

106. The defendants submit that the Rutland Trust was a will trust created by the will of the deceased which was constituted at the date of the grant of probate. Vicki and Mr Neal were the original Rutland Trustees who had vested in them a chose in action which was the right to call for due administration of and transfer of property under the terms of the will. Such a chose in action was transmissible and capable of being settled on trust. The Rutland Trust without more therefore had existed since 30 August 2002.

107. Further in any event an assent can be express or implied. The implication can be as a consequence of a change in the character in which the relevant assets were held and/or by inference from the conduct of the relevant parties in relation to the asset said to have been impliedly assented. Consequently, such an implicit assent does not need to be in writing particularly where it relates to a beneficial interest. There would therefore be no bar in principle to an implied assent in relation to the share in the Property which accrued to the Rutland Trust.

108. The starting point is to consider what is the nature of the interest that a beneficiary has in an unadministered estate.

109. In Commissioner of Stamp Duties v Livingston [1965] AC 694 at 707 the Privy Council considered the nature of the interest of a residuary legatee in an unadministered estate as well as those of an executor. The case concerned Mrs Coulson’s estate and its interest as a residuary legatee in her late husband, Mr Livingston’s unadministered estate. “. . . whatever property came to the executor virtute officii came to him in full ownership, without distinction between legal and equitable interests. The whole property was his. He held it for the purpose of carrying out the functions and duties of administration, not for his own benefit; and these duties would be enforced upon him by the Court of Chancery, if application had to be made for that purpose by a creditor or beneficiary interested in the estate.”

110. Equity does not recognise or create a beneficial interest in the assets in the executor's hands during the course of administration for residuary legatees. However, having reviewed a number of authorities at 717C to D the Privy Council opined that the correct test was the one that had been considered in Sudeley (Lord) v Attorney General [1897] AC 1 . Consequently it was necessary to determine the nature of the interest a person was entitled to under the will in the unadministered estate: “If the present appeal is tried by this test … their Lordships regard it as clearly established that Mrs. Coulson was not entitled to any beneficial interest in any property in Queensland at the date of her death. What she was entitled to in respect of her rights under her deceased husband’s will was a chose in action , capable of being invoked for any purpose connected with the proper administration of his estate ; …”

111. Lewin on Trusts 20 th Edition (“ Lewin ”) at 2-040 explains it in this way: Interests under estates in course of administration It is well established that interests in estates in the course of administration are capable of being settled. [ Commissioner of Stamp Duties (Queensland) v Livingston [1965] A.C. 694 PC] . This is often done by “instruments of variation” intended to take advantage of inheritance tax and capital gains tax reliefs, where it is normally essential that the “variation”, effectively a resettlement, should be made without consideration other than the consideration of making a variation or disclaimer of other dispositions within the same estate. It seems that in such cases the property which the settlor is settling is a present right to secure the due administration of an estate. While there is no difficulty in resettling by such instruments the present right to due administration as regards the capital or income of an unadministered residue, or an undivided share in it, or charging it with the payment of money (which usually takes the form of a “legacy” written into the relevant will), it is not clear whether it is permissible, as a matter of trust law, [ the footnote records that “There is however no difficulty as a matter of revenue law: IHTA s.142 (6) …” ] to resettle, without consideration, specific assets comprised in an unadministered residue, for a beneficiary has no beneficial interest in any specific asset in the estate until there has been an assent in respect of it. It is accordingly thought that the safer course is to ensure that the personal representatives make an express or implied assent in respect of such assets before the “variation” is made.

112. Williams Mortimer and Sunnucks on Executors, Administrators and Probate 22 nd Edition (“ WMS ”) at Chapter 72.03 explains the rights of beneficiaries in unadministered estates: Right of beneficiary Until assent or conveyance, a person interested under the will or intestacy has an inchoate right transmissible to his own representatives. It is a chose in action capable of itself being settled or transmitted [ Marshall v Kerr [1995] 1 A.C 148 at 166]. A person so interested cannot, however, without the authority of the representatives, take possession of the property, even though the testator expressly directs that he shall do so; otherwise a testator might appoint all their effects to be taken in fraud of creditors. Should the beneficiary take possession, the representatives may sue them for possession, trespass or conversion, according to the circumstances. Thus, although the beneficiary is actually in possession of property specifically bequeathed, and the assets are fully adequate to the payment of debts, the beneficiary has no right to retain property in opposition to the representatives, by whom, in such a case, an action will lie to recover it . The inchoate right, is however, equivalent to a beneficial interest under a trust for limitation purposes.

113. In Marshall v Kerr [1995] 1AC 148, Mrs Kerr was entitled to half of the residuary estate of the deceased. Whilst the estate was still being administered, she entered into an arrangement varying the will so as to settle her share of the estate under trusts. The claim was primarily concerned with the tax treatment but in considering the issues their Lordships addressed the question of what interest Mrs Kerr had in the unadministered estate. Lord Templeman at 157E to 158A referred to the summary of Lord Radcliffe’s advice by Buckley J in In re Leigh’s Will Trusts [1970] Ch 277 , 281 – 282: " (1) the entire ownership of the property comprised in the estate of a deceased person which remains unadministered is in the deceased's legal personal representative for the purposes of administration without any differentiation between legal and equitable interests; (2) no residuary legatee or person entitled upon the intestacy of the deceased has any proprietary interest in any particular asset comprised in the unadministered estate of the deceased; (3) each such legatee or person so entitled is entitled to a chose in action , viz. a right to require the deceased's estate to be duly administered, whereby he can protect those rights to which he hopes to become entitled in possession in the due course of the administration of the deceased's estate ; (4) each such legatee or person so entitled has a transmissible interest in the estate, notwithstanding that it remains unadministered . This transmissible or disposable interest can, I think, only consist of the chose in action in question with such rights and interests as it carries in gremio. . . . If a person entitled to such a chose in action can transmit or assign it, such transmission or assignment must carry with it the right to receive the fruits of the chose in action when they mature."

114. Lord Templeman then applied this analysis to the facts in Marshall v Kerr explaining at 158B: “By the arrangement Mrs. Kerr assigned and created a settlement of the chose in action to which she was then entitled as a beneficiary under the will of the testator . The trustees of that settlement received the fruits of the chose in action in due course.”

115. And then continued at 158D: “By the law of England, the arrangement was a settlement by Mrs. Kerr of a chose in action, namely the right to require the estate of the testator to be duly administered. Mrs. Kerr was the settlor of that chose in action which was not an asset of which the testator was competent to dispose .”

116. In Re Neeld dec’d [1962] (Ch) there had been a conditional devise of certain land to trustees on trust for a named beneficiary for life with remainder to others. The relevant issue for these purposes was when the beneficiary became entitled to require the executors to execute a vesting assent in favour of trustees. The Court of Appeal accepted that the devised property would not be required to meet any debts or the costs of administration but nonetheless considered that there were other matters that might provide justification for the executors refusing to execute a vesting assent having been called upon to do so.

117. Diplock LJ and Upjohn LJ at 690 and 691explained that the beneficiary was not entitled to the actual receipt of any income as a life tenant until either the executors executed a vesting assent or the beneficiary was entitled to call for it.

118. However, Upjohn LJ continued at 691: “I do not want to throw any doubt upon the general proposition that it is no doubt legally correct to describe the third defendant as the person entitled in equity to the estates devised to him by clause 3.”

119. Thus, the right of a “person” entitled under a will in an unadministered estate was limited to a chose in action rather than a beneficial interest in the assets themselves that were in the executors’ hands. A chose in action is an asset. A “person” entitled under a will in an unadministered estate therefore has a valuable asset which allows them to seek due administration of the estate but does not entitle them to physical possession of the assets in the unadministered estate. Such a chose in action was transmissible which enables the person entitled to, for example, settle it on trust. But it is the chose in action not the underlying asset in respect of which the “person” entitled has rights not the underlying asset itself. As Mr Adams submits an assent is needed to pass on any beneficial interest in the underlying assets but it can be implied.

120. Mr Adams argues that the inchoate rights are those of beneficiaries but not those of a prospective trustee. He submits that the prospective trustees were never in the position of and could not be the “person” with the chose in action or the inchoate right.

121. Further whilst there may come a point during the course of the administration when a beneficiary with sufficient interest may be entitled to call for an assent, a prospective trustee has no such a right. Vicki as prospective trustee never had a sufficient proprietary interest to have standing to invoke the court’s supervisory jurisdiction to require the executors to assent the Property to her. Without an assent of property or assets the Rutland Trust could never have been properly constituted. Vicki remained a prospective trustee only and as a consequence the defendants did not have standing and were not and never could have been the Rutland Trustees and the Rutland Trust was never constituted.

122. I do not agree with Mr Adams. There is a clear distinction between a “person’s” beneficial interest in specific assets in an unadministered estate - whether clearly identifiable or not - and the chose in action which accrues to the person entitled when probate is obtained. The chose in action is an asset that is clearly identifiable property in which the person entitled has an interest. It is separate to any interest the person entitled asserts over a specific asset in the unadministered estate which they seek to have vested in them. The chose in action is a separate identifiable asset which exists and has value separate to the specific assets. In relation to those specified assets I agree an assent is usually required but it does not necessarily need to be express.

123. It seems to me therefore that if the defendants are Rutland Trustees, they have the same standing as any other “person” or “beneficiary” entitled under the terms of the will rather than qua trustees. They are not in that context any different from any other person or beneficiary entitled under the will. They would have the same rights to seek due administration of the estate by reason of a chose in action as any other “person” entitled under the terms of the will. That does not require an assent to vest property in the hands of the person entitled - in this case the Rutland Trustees. Indeed as Lord Templeman explained the chose in action was not an asset that had been the testator’s to dispose of. That chose in action was not something which the executors could be asked to assent to the person entitled to it.

124. Just like Mrs Kerr or Mrs Coulson, the Rutland Trustees in their capacity as beneficiaries/persons entitled would have a right to require the estate of the testator to be duly administered. As set out above “ a right to require the deceased's estate to be duly administered, whereby [the trustees] can protect those rights to which [they hope] to become entitled in possession in the due course of the administration of the deceased's estate .” Re Neeld is entirely consistent with that distinction and does not assist the claimants.

125. If the defendants are Rutland Trustees of the Rutland Trust, they have a chose in action which gives them standing and the right to call for the due administration of the estate in their capacity as a “person” or “beneficiary” entitled to call for the estate to be duly administered under the terms of the will.

126. There is a separate question about whether in those circumstances the Rutland Trustees would have a sufficient interest to call for an assent of the actual property/assets to which they hope to become entitled to in possession in due course which I consider further below. Rutland Trustees?

127. Fundamental to the defendants’ position is their submission that they are not merely prospective trustees but that the will trust was created by the will itself such that the rights arising from the existence of the chose in action were vested in the trustees of the will trust as soon as probate was granted. At that point the will trust was constituted, the Rutland Trustees were Rutland Trustees and the Rutland Trust held a valuable asset, the chose in action to call for the due administration of the estate. The Rutland Trustees were the persons entitled to call for the due administration of the estate. Vicki as the remaining Rutland Trustee by the DOA appointed the defendants as Rutland Trustees and that right now vests in them. That they say is in reality the beginning and the end of it.

128. Lewin at 3.066: Testamentary Trusts explains: “Subject to the requirement of the will being entitled to probate, a trust may be declared by will of any property which vests in the testator’s personal representatives. Such a testamentary trust is completely constituted as soon as the will is admitted to probate, even where the named trustee is incapable of acting [ Re Smirthwaite’s Trusts (1871) L.R 11 Eq. 251 (“ Re Smirthwaite ”)].”

129. Mr Adams disagrees with the editors of Lewin. He says that Re Smirthwaite is not authority for the proposition set out in Lewin . He submits that Gunson v Simpson (1867-68) L.R 5Eq 332 on which Re Smirthwaite relies has to be considered on its own facts.

130. In Gunson, the sole trustee named in the will had pre-deceased the testator. By her will the testator had left her real property and personal property to the trustee on trusts for sale with the proceeds to be divided between the persons who made the claim and the trustee. The claim was brought by persons interested in the proceeds of sale on the basis that there was no trustee to administer the sale in accordance with the terms of the will. Having accounted to the persons so interested the trustee would then hold the balance of the proceeds of sale on trust for the heir of the testatrix. An order was made appointing a new trustee. This was objected to by the Registrar who sought to argue there was no jurisdiction to appoint a new trustee because the original trustee had pre-deceased the testator.

131. Section 11 Trustee Act 1850 engaged the court’s powers if the person ultimately entitled under the terms of the trust, for example, could not be found. The Trustee Act 1850 provided the court with broad powers in respect of contingent rights including the power to appoint new trustees.

132. Whilst the Vice Chancellor was clearly in no doubt about the extent of his power to appoint a new trustee or the existence of the trust, he adjourned the application to allow the applicants to seek to comply with the requirements of the Trustee Act 1850 and bring themselves within section 11 so that any order made would bind the heir.

133. In Re Smirthwaite the will of Mr Smirthwaite left his residuary real and personal estate to three trustees on trust including a trust to sell the real estate. By the time he died all three of the trustees had pre-deceased him. At the time of his death he held freehold and copyhold property. The tenant for life and the first tenant in tail in remainder applied to appoint new trustees under the Trustee Act 1850 and for a vesting order. The applicants served the heir at law and the customary heir of the testator so as to give them notice of the claim. Sir R Malins VC concluded that as the heir was before the court there was no difficulty in the court appointing new trustees to the trust.

134. Mr Adams submits Gunson is support for his contention that it is only a beneficiary that has the requisite rights and standing and that the reason the new trustees were appointed in Re Smirthwaite was because all the interested parties were before the court including the heir/beneficiary. As a consequence the court felt able to vest the assets in the new trustees. In a sense that is right but that was not because there was no existing trust and or that the trust had not already been properly constituted, but because the trustees of that trust were dead. The applicants in Re Smirthwaite having complied with the requirements of the Trustee Act 1850 the judge was satisfied he could appoint the new trustees to administer the trust. The question put to the court did not concern the vesting order at all but whether the court had the power under the Trustee Act 1850 to appoint new trustees where there were no existing trustees.

135. In both Gunson and Smirthwaite the decisions were about the appointment of new trustees to existing trusts where the trustees had pre-deceased the testator in each case. There was no doubt expressed in either authority that the trusts did not exist. Gunson therefore does not assist Mr Adams at all.

136. As Mr Moffett argues, quite the contrary, the existence of the trust and the need for new trustees underlies both claims. The applications were advanced on the basis that the trusts had already been constituted and were focussed on who should be appointed to replace the trustees named in the wills and on what basis.

137. The judge in Re Smirthwaite considered he had sufficient jurisdiction to appoint new trustees to a trust that came into existence by the terms of the will of the testator on the application of those entailed in the remainder. That notice was given to the heir who may have had an interest in not only the underlying assets but also the identity or choice of trustee does not change that analysis. There was no doubt in the court’s mind that it was appointing trustees to a trust that arose under the will and currently had no trustees.

138. Even in Gunson the court did not doubt the existence of the trust but was not prepared to appoint the trustees without notice to the heir. Since the trustee so appointed would be administering the trust for that heir having accounted to the applicants that was not a surprising outcome at all. It is hardly surprising that the court would want to be satisfied that the parties had complied with the provisions of the Trustee Act 1850 before making any order. There was no suggestion that the applicants did not have standing to make the application nor that the trust did not exist.

139. It seems to me therefore that the learned editors of Lewin are right to conclude that Re Smirthwaite is authority for the proposition that a will trust is completely constituted as soon as the will is admitted to probate.

140. Whilst a trust cannot exist without assets, as set out above at the same time as the will is admitted to probate the will trust accrues a valuable asset in the form of a chose in action of the right to call for due administration of the estate. Consequently, the conclusion that the will trust is completely constituted on the grant of probate is entirely conventional.

141. I am satisfied therefore that when the grant of probate was obtained on 30 August 2002 that the Rutland Trust was completely constituted in accordance with the terms of Clauses 9 and 10 of the will and held a valuable asset in the form of the chose in action to call for due administration of the estate. Vicki and Mr Neal were from then the Rutland Trustees and not prospective trustees. Mr Neal disclaimed leaving Vicki as the remaining Rutland Trustee.

142. If follows that the DOA entered into by Vicki and the defendants was a valid and effective DOA appointing the defendants as Rutland Trustees together with Vicki.

143. The defendants are therefore the current Rutland Trustees. Issue 2: What property is held by the defendants and subject to what trust(s)?

144. The next question is what other assets are the subject of the Rutland Trust. As set out above for the share in the Property or the Cash Sum to be passed to the Rutland Trust there would have had to be an assent. JSH says there was no assent so the assets did not pass into the Rutland Trust. Assent :

145. Chapter 72 of Williams Mortimer and Sunnucks on Executors, Administrators and Probate 22 nd Edition (“ WMS ”) introduces its chapter on assents: “An assent has been described as an acknowledgment by a personal representative that an asset is no longer required for the payment of the debts, funeral expenses or general pecuniary legacies.”

146. An assent is therefore a confirmation that the asset is not needed to meet liabilities.

147. An assent of a legal interest rather than beneficial interest must be in writing: see s.36 (4) Administration of Estates Act 1925 . An assent of a beneficial interest “even a beneficial interest in land” has no prescribed form nor does it need to be in writing. Such an assent need not be express but can be implied. Whether it can be implied will depend on the particular facts.

148. WMS at 72.10 explains: “The operation of the assent was not to convey the property to the devisee, but to perfect an interest which until then had been inchoate. For this reason a devisee cannot claim any description beyond that contained in the will.… An assent of realty, as in the case of personalty, might have been either express or implied.”

149. Mr Adams argued that the prospective trustees did not have a sufficient proprietary interest to invoke the court’s jurisdiction to call for an assent of the deceased’s share in the Property or the Cash Sum. However, the basis for his submissions was that the defendants were the prospective trustees and not the Rutland Trustees. I have found them to be the Rutland Trustees for the reasons set out above.

150. Re Neeld does not therefore assist the claimants. The Rutland Trustees stand in the same position as any party entitled in equity to call for an assent of the assets devised to the trust under the terms of the will trust - in this case the half share in the Property and the Cash Sum.

151. In Clowes v Hilliard (1876) 4 Ch D 413 the claimants sought to advance their entitlement to benefit from the will of the deceased. The will provided that if the deceased’s daughters died without issue his estate would pass to those who would have been his next of kin otherwise on an intestacy. The will appears to have left the deceased’s estate on trust to his daughters with a default trust to what the MR described as “collateral relations”.

152. The oddity of the case was that the daughters were very much alive and the judgment records that one of them was about to be married. The MR concluded that in those circumstances the court simply could not predict if any one of those persons who had issued the claim would be a member of the class entitled under the default provisions if the default provisions took effect. They could not be ascertained now. Their interest was described as no more than an expectation of a future interest with no current vested or contingent interest. It appeared to me to be an entirely opportunistic application.

153. That seems to me to be entirely different to the position here. Had these claimants sought to accelerate their entitlement to the share in the Property or the Cash Sum prior to Vicki’s death on some basis they would have been in a similar position to the collateral relations. Their interest did not crystallise until Vicki died.

154. Mr Adams accepted that in the course of the administration there may come a point at which a beneficiary has a sufficient interest to become entitled in equity to call for an assent. The executors would then have to consider in the reasonable management of the estate whether to assent the relevant property. Any dispute at that stage might be sufficient to enable the beneficiary to invoke the court’s supervisory jurisdiction to obtain a direction for an assent. He submitted that it was only at that stage that the beneficiary obtained any proprietary interest in the relevant property.

155. I am satisfied that the Rutland Trustees would have had a sufficient interest to call for an assent and/or to apply to the court for directions – see Re Neeld . Had they done so the court would have considered the application on its own merits at the time. The defendants say they did not because of the poor relationship between the claimants and Vicki and the defendants.

156. By the time of Vicki’s death there had been no express assent in writing of the deceased’s share in the Property to the Rutland Trust. Although the Rutland Trustees had called for the Cash Sum it too had not been assented or paid across to the Rutland Trustees. But the absence of an express assent in writing is not an end of the matter.

157. In Re Edwards [1982] Ch 30 the issue that arose concerned whether the property in issue had been the subject of the deceased’s will trusts and whether there could be an implied assent of property in the hands of trustees. Buckley LJ at 40B to 40F: “I propose to deal next with the question whether the property…has ever been subjected to the trusts of the testator’s will. The argument presented by Mr. Etherton for the defendant has been that, since [Mr. Edwards] as administrator of his wife's estate never made any written assent in respect of the property or any part of it in his own favour as the sole beneficiary entitled to it, the legal estate was at his death vested in him as such administrator and so did not pass to his executors but remained an unadministered asset of Mrs. Edwards' estate. He relied upon re King's Will Trusts [ [1964] Ch 542 ]. I proceed on the basis that this is correct. It does not follow that the equitable beneficial interest in the property did not vest in [Mr. Edwards] in his lifetime so as to form part of his estate at his death (see re Hodge , [ [1940] Ch 260 at 264]. [Mr. Edwards] enjoyed the beneficial occupation of the property for nearly 20 years after Mrs. Edwards' death. Nothing in the evidence suggests that during the greater part of that period any liabilities of Mrs. Edwards' estate remained outstanding. It is evident that when the plaintiff and the defendant executed the assent of 25th April 1950 they regarded the property as having vested beneficially in [Mr. Edwards]. They were clearly not aware that the legal estate might have then been outstanding. The assent may have been ineffective to vest the legal estate, but this does not deprive it of significance as evidence of the executors' views as to where the beneficial interest was when [Mr. Edwards] died. An assent to the vesting of an equitable interest need not be in writing. It may be inferred from conduct. In my judgment there are ample grounds for inferring that [Mr. Edwards] assented in his lifetime to the vesting in himself of the full beneficial interest in the property. If so, that beneficial interest passed to his executors upon his death and became subject to the trusts of his will. For these reasons I am of the opinion that the property is subject to the trusts of [Mr. Edwards'] will.

158. In Re Hodge [1940] Ch 260 at 264, Farewell J said: “It is said in the first instance that here the property can never have vested in the plaintiff as beneficiary or devisee because there had been no written assent and that under the Administration of Estates Act, 1925, s. 36 , sub-s. 4 such an assent is necessary. In my judgment that is not the true view. No doubt under the Act if a vendor is selling as beneficial owner taking under a will, the purchaser is entitled to require a written assent in order that he may be satisfied as to the title; and the Act gives him the right to demand it, but in a case of this sort the position is not the same. The legal estate in the property is vested in the plaintiff as legal personal representative and there is therefore no difficulty with regard to that. His equitable interest as devisee depends upon equities and upon whether or not he has done acts which must be treated as amounting to sufficient evidence of assent so as to make it impossible for him now to say that he has never accepted this gift. ”

159. WMS at 72.14 addresses this issue further: “While it is clearly desirable for a representative, who is entitled beneficially or as trustee, to make an assent in his own favour after completion of administration, the view was taken that despite the provisions of . [ s.36(4) of the Administration of Estates Act 1925 requiring an assent in writing to effectuate the passing of the legal estate, a written assent was not strictly necessary as there was no passing of the legal estate but merely a change in the character in which it was held Re Hodge, Hodge v Griffiths [1940] Ch. 260 ] This view has been held incorrect, but in a decision where the relevant authorities were not all cited.[ Re King’s Will Trusts, Assheton v Boyne [1964] Ch. 542 ] In future a representative will never safely be able to terminate his character of representative in his own favour otherwise than by a written assent and if the chain of representation has been broken without assent being made, it will be necessary, although the administration is at an end, to obtain a grant of administration of unadministered assets (de bonis non) to put the title in order. While this is the only safe view to take, its correctness must be doubted in the light of [ Re Hodge, Hodge v Griffiths and Re Edwards and para.72-10].”

160. The defendants submitted even if Re King’s was correct, and that is doubted by WMS in light of Re Edwards and Re Hodge, Re King’s only sets out the position in relation to the legal title not the beneficial title.

161. Vicki was an executor but also the original Rutland Trustee. She was the person who was to benefit from the life interest trust created by Clause 9 and 10 of the deceased’s will. The purpose of the Rutland Trust was to provide for Vicki so that she could continue to live in the Property until her death. It provided not only a life interest in the deceased’s half share in the Property but the income derived from the Cash Sum.

162. The defendants say that in the events that have occurred there had been an implied assent of the beneficial interest in the deceased’s share in the Property.

163. The claimants’ position is of course tied into their primary case which is that the defendants are not Rutland Trustees and there was no Rutland Trust. Consequently their position in relation to the assent issue was that the defendants never had a right to call for an assent and now that Vicki is dead never will have. Mr Adams maintained that Vicki would not have been able to unilaterally transfer or assent the share in the Property to the defendants.

164. Whilst it appears that the estate may not have been fully administered for which the claimants, at least in part, blame Vicki, it does not appear that the assent of the share in the Property or the Cash Sum were likely to impede the administration of the estate or be required for the administration of the estate. Neither asset appears to have been needed to meet any liabilities of the estate.

165. Throughout the period of nearly 22 years following the death of the deceased Vicki lived in the Property rent free, both the half in which she had a life interest under the Rutland Trust and the half which fell into her estate. Just like in Re Edwards Vicki had enjoyed uninterrupted beneficial occupation of the Property for over 20 years after the deceased’s death. Whilst possession of itself would not be sufficient to change the character in which the Property was held it forms part of the background and conduct relevant to considering whether an implied assent had taken place.

166. The defendants submit that at the very least the claimants have acquiesced in Vicki’s continued occupation rent free. The claimants complained that the Property was not maintained by Vicki relying on Vicki’s obligations under the Rutland Trust to maintain the Property. This appeared to me to be more consistent with a recognition of the existence of the Rutland Trust but also that an implied assent had occurred. The claimants do not seem to have taken any steps to address these maintenance concerns as executors, again more consistent with the existence of the Rutland Trust and an implied assent. They have not sought to evict her nor have they demanded rent.

167. Although the claimants have consistently denied the existence of the Rutland Trust they have nonetheless referred to Vicki as the life tenant and appear to have acknowledged her as such. They have not themselves taken on management or control of the Property. They have acted consistently with the terms of the Rutland Trust at least in relation to Vicki’s occupation and consistent with it being held in the Rutland Trust for her benefit. Vicki’s only interest in the share in the Property under the will of the deceased derived from the clauses that created the Rutland Trust – her life interest.

168. As set out above in 2016 the claimants proposed that the Cash Sum be ring fenced and that Vicki receive the interest on that sum whilst the claimants would receive the balance of the sums in the relevant account. If they were in a position to partially distribute to themselves as well as ring fence the Cash for Vicki (whilst seeking to avoid passing it to the Rutland Trust which they would not recognise) it seems tolerably clear that by at least 2016 there were no liabilities of the deceased’s estate that would have prevented the assent of the Cash Sum.

169. In respect of the Cash Sum JSH blames Vicki for the estate not being in a position to set up a trust of income which not only acknowledges the need to do so but the ability to do so. It is clear from the evidence that the claimants considered there was some advantage in being able, as they believed, to maintain that the Rutland Trust did not exist. Whatever that advantage was considered to be they appear to have recognised that Vicki was entitled to an income trust related to the Cash Sum and recognised that Vicki was a life tenant without making any concession as to the existence of the Rutland Trust.

170. As set out above it appears that the estate remains in good financial health, in 2022 the estate bank account held over £500,000.

171. For the purposes of any implied assent (or indeed any assent) there was no difficulty in identifying the assets and no real risk to the estate in assenting them. As explained above an assent is a confirmation or acknowledgment that an asset is no longer required to meet the liabilities of the estate.

172. It seems entirely clear from the conduct of the claimants in relation to the administration of the estate that neither the share in the Property nor the Cash Sum were required for the general administration of the estate or to meet any liabilities.

173. As set out above, following the deceased’s death negotiations took place between the claimants and Vicki with a view to varying the will. The negotiations involved consideration of a sale of the Property or a purchase of the deceased’s share by Vicki. They did not result in the variation of the will. The negotiations continued and it was not until some time in 2007 that they appear to have come to an end. Whether or not those negotiations may be considered to be inconsistent with an implied assent of the beneficial interest to the Rutland Trust at that time, the position changed by at least 2007/2008.

174. The Transfer took place in 2007 followed by the DOA and DOT in January 2008. Vicki was both the sole legal proprietor of the Property, an executor and the remaining Rutland Trustee when these events took place.

175. It is said by Mr Adams that Vicki could not undertake a unilateral act that would amount to a change in character causing the share in the Property to be impliedly assented to the Rutland Trust but this was at least in part because he maintained that she was only a prospective trustee. He submitted that none of the surrounding evidence such as her occupation rent free had any relevance at all. I do not agree.

176. The defendants submit that the Transfer, DOT and DOA would have been sufficient for an express assent of the legal title since the title was in fact transferred to the Rutland Trustees. But that in any event the combined effect of the conduct of the parties including the claimants, and the execution of the Transfer, DOA and DOT was such as to change the character in which Vicki held her interest in the share of the Property to that of Rutland Trustee and impliedly assent it to be held in the Rutland Trust by the Rutland Trustees for her benefit as life tenant under the terms of the will (see Re Hodge and Re Edwards ).

177. That is further reinforced in that although the claimants denied that Vicki and the defendants were the Rutland Trustees there is no evidence that they took any action in relation to the Property which was inconsistent with the implied assent the defendants contend for either before or after January 2008 until after Vicki’s death.

178. The defendants say that putting all of these factors together there is sufficient in the circumstances of this case for the court to infer that there was an implied assent.

179. I agree with that analysis. I am satisfied that in the events that occurred there were ample grounds for inferring that the deceased’s share in the Property was impliedly assented to the Rutland Trust by no later than 17 January 2008. The subsequent conduct of the claimants, Vicki and the defendants in relation to the deceased’s share in the Property is consistent only with that implied assent having taken place. The claimants’ assertion in correspondence that the defendants are not Rutland Trustees after 2008 does not affect that inference.

180. The position in relation to the Cash Sum is different and the parties’ submissions and evidence did not fully address the question of whether or how there was or could have been an implied assent of the Cash Sum particularly given that it was retained by the claimants throughout. I do not consider I am yet in a position to make any final determination about whether the Cash Sum can be said to have been impliedly assented to the Rutland Trustees/Rutland Trust.

181. In the events that have occurred the legal title to the Property is held by the defendants under the Property Trust to distinguish it from the Rutland Trust. The Property Trust therefore holds the legal title to the entire Property rather than just the deceased’s share. The question of to whom it should be transferred if the defendants retire, as they wish to, will need to be considered by the parties and with Mr Bradshaw. Tax

182. Both the claimants and the defendants sought to derive support from their respective positions as to the way in which HMRC treats estates and will trusts for tax purposes. Whilst those submissions may have some relevance to the extent of the indemnity the Rutland Trustees may be entitled to it did not provide me with any assistance in determining whether and when the Rutland Trust came into existence or whether the defendants were Rutland Trustees. It does not change the approach to the legal analysis. Neither does the recent HMRC nil computation for tax filed by JSH.

183. Conversely the decision that the defendants are the Rutland Trustees and that the Rutland Trust exists may have an impact on how HMRC treat the tax position in relation to both estates and the Rutland Trust. From the defendants’ perspective as Rutland Trustees they may be personally liable for any tax that should have been paid on assets of the Rutland Trust.

184. At present it appears that Vicki’s estate has filed an IHT 400 which confirmed her interest in the Cash Sum and the Rutland Trustees have filed an IHT100 detailing both the half share in the Property and the Cash Sum. The claimants have also filed an IHT100 which it is suggested did not include the Cash Sum. It will be a matter for the parties and their advisors to consider what if any different approach may now be needed. Conclusion:

185. For the reasons set out above I am satisfied that the defendants are the current Rutland Trustees of the Rutland Trust which was completely constituted when a grant of probate was obtained on 30 August 2002.

186. From 30 August 2002 the original Rutland Trustees (Vicki and Mr Neal) had the right to call for the due administration of the estate. The Rutland Trustees in that capacity are no different to a “beneficiary” or “person” with an interest in an unadministered estate. The chose in action that they had was not a beneficial interest in any specific property or fund or asset which might eventually form part of the will trust but exactly the same chose in action as any other beneficiary in an unadministered estate – a right to call for the due administration.

187. Vicki as the remaining Rutland Trustee appointed the defendants as Rutland Trustees by the DOA. They were validly appointed and remain the current Rutland Trustees following Vicki’s death.

188. For the reasons set out above I am also satisfied that there was subsequently an implied assent vesting the deceased’s share in the Property such that the Rutland Trustees hold that share in the Rutland Trust. That implied assent occurred at the latest in about 17 January 2008.

189. On the basis of the evidence and submissions advanced by the parties at the hearing it is not possible to determine any other aspects of the counterclaim at this stage. Directions will need to be given at the consequentials hearing in due course should that be necessary.

190. However, my intention is to allow the parties a period of time following the handing down of this judgment to see if they can now finalise the terms of the indemnities which they had been discussing in May 2025. If the parties reach an impasse, they should consider using a mediator or other appropriate form of ADR.

191. They should liaise with Mr Bradshaw to agree the way forward in relation to the Property Trust. It may be that as part of the negotiations a way can now be found to progress the sale of the Property in the interests of both the deceased’s and Vicki’s estate.

192. To that end I will not list a hearing for consequential matters or further directions in relation to the counterclaim before November 2025. That provides the parties with two months to seek to resolve matters.