Analysis
By his will dated 17 January 2011 (the will), Arthur Brookman (the deceased) appointed his wife, Sandra Brookman, together with her children and brother to be the executors and trustees. The deceased placed his beneficial half share in the matrimonial home at 49 Hemsby Road, Castleford (the property) in a discretionary trust for the benefit of a class of potential beneficiaries that included his wife, his children by a former marriage, his stepchildren and six named grandchildren. Subject to the power of appointment, the capital and income were held on trust for such of his children and stepchildren as were living at the date of his death. The residuary estate was directed to be held on trust for his wife or, if she predeceased him, for such of his children and stepchildren as were living at the date of his death.
In the event, the deceased and his wife were divorced on 17 August 2017. Although it was intended that the deceased’s wife would move out of the property and she had in fact put down a deposit on another property (which she subsequently lost), she continued to reside there to look after the deceased after he had been diagnosed with dementia and her state of health subsequently deteriorated to the point that she was unable easily to move elsewhere.
The deceased died on 30 October 2018 and probate was granted to the first defendant (the deceased’s wife’s son), with power reserved to the second defendant (the deceased’s wife’s brother), on 29 January 2019. The claimants (the deceased’s children by a former marriage) sought the removal of the defendants and the appointment of themselves in their place on the grounds that they had failed to administer the estate or carry into effect the trusts properly or in the interests of the beneficiaries. They alleged that, in conflict between their duties and interests, they had permitted the interests of the deceased’s wife to be preferred to those of the beneficiaries and had failed, in particular, to take any steps to realise the deceased’s beneficial half share in the property or to charge his wife an occupational rent pending sale.
Held (dismissing the application):
The overriding consideration, when making a decision whether or not a trustee should be replaced, was the welfare of the beneficiaries and the competent administration of the trust in their favour. In this case, the administration of the estate had largely been completed and only residue fell to be distributed. It was not accepted that the evidence demonstrated a failure on the part of the defendants to reach decisions correctly.
As regards the alleged failure to charge an occupation rent, the deceased’s wife was entitled to occupy the property under the Trusts of Land and Appointment of Trustees Act 1996 and the right to require the person in occupation to pay rent only arose where the rights of another person entitled to occupy had been restricted or removed – in this case there were no other relevant such persons. Moreover, in circumstances in which it was likely to be found that the trust of the property was originally set up with the intention of providing a home for the deceased and his wife, which continued after his death and her inability to acquire a suitable alternative property, the defendants’ decision not to seek an order for sale with vacant possession was one within a range of reasonable decisions which they could properly reach.
As regards the allegation that the defendants were in a position where there was a conflict between their duties as trustees and their interest in looking after their mother/sister, if there be a conflict, it was one which was in effect brought about by and therefore sanctioned by the terms of the will.
In conclusion, the decisions which the defendants had made as trustees as regards occupation rent and sale were ones which were properly open to them and which were not ones reached because of some improper motive of benefiting the deceased’s wife in preference to the interests of the discretionary beneficiaries under the will.
JUDGMENT HHJ DAVIS-WHITE QC: [1] This is my judgment following the hearing of the CPR part 8 claim form issued on 25 January 2021. In its terms the claim form seeks the removal of the defendants as trustees and executors of the will of Arthur Brookman (the ‘Deceased’) and the appointment of the claimants in …Continue reading "Brookman & anr v Potts & anr [2022] WTLR 37"