Analysis
C was a brother of the deceased (PK). He was the executor of PK’s will and also a beneficiary. Ds were the adult children of PK’s sister. PK’s will divided the residue into ten equal shares (including a share for each of PK’s sister’s children). C brought a claim under s20 Administration of Justice Act 1982 (AJA 1982) for rectification of the will so that the residue would instead be divided into six equal shares (with one share being shared between PK’s sister’s children). The claim was opposed by D3 and D4.
PK was born in the Irish Republic on 4 February 1934. He had eight siblings. He never married and had no children. In the early 1970s, he moved to England and never returned to live in Ireland, though he occasionally visited his siblings in Ireland.
On August 2006, PK met his solicitor to give will instructions. By this time he had six living siblings remaining. He received a state pension in England and a small state pension in Ireland. He held substantial assets with Barclays Bank in London, and owned a property in Ireland called Woodlands which he had inherited from his parents. PL instructed his solicitor to prepare a will dividing his estate between his surviving siblings. The notes also recorded that they ‘discussed residency and taxes in Ireland… He has a tax no. in England but not in Ireland’.
On 18 August 2006, PK executed a will (the 2006 will) dividing his estate as instructed into six equal shares. It started with PK’s name and then stated ‘of Woodlands, Castledermot, County Kildare’.
On 6 January 2009, PK was granted a long lease of a flat in Fulham (the flat). The premium was £220,000. In 2010, PK sold Woodlands but retained some land near the family home in Punketstown Lower, Castledermot, which included an uninhabited cottage.
On 5 July 2010, PK returned to his solicitors to give instructions for a new will. This time he spoke to a different solicitor. The solicitor’s notes record instructions that the residue was to be bequeathed:
‘… to sister, Eileen Delaney, Kathleen Kelly (wife of decd brother James) brothers, Michael;, Vincent & John and the children of his deceased sister Maureen Brennan, namely Mary, Matthew, Fergus, Vincent, and Damien Brennan in equal shares… By equal shares I mean one-sixth to each of my siblings and remaining one-sixth equally between children of Maureen Brennan decd.’
On 5 July 2010, the will was executed. It was witnessed by the solicitor and the solicitor’s daughter. It left the residue to:
‘… my sister, Eileen Delaney, my sister in law, Kathleen Kelly… and my brothers Michael Kelly, John Kelly and my niece Mary Brennan and my nephews, Matthew, Fergus, Vincent and Damien Brennan (the children of my deceased sister, Maureen Brennan) in equal shares absolutely subject only to the payment of my debts, funeral and testamentary expenses.’
It gave PK’s name and then said ‘of Plunketstown Lower, Casteldermott in the County of Kildare’.
PK died on 9 June 2014. His death certificate recorded his address as the flat in Fulham but that he died in a care home. An Inland Revenue affidavit dated 21 December 2015 by C swore that PK’s domicile of origin was in Ireland but that his domicile at death was in England. Probate was granted on 7 November 2014.
C brought a claim for rectification under s20 AJA 1982. His claim form included a claim for ‘such further or other relief as the court thinks fit’. The claim was issued on 1 May 2018, nearly three years after the expiry of the six-month period in s20(3) AJA 1982. C therefore required an extension of time in which to bring it.
Held (allowing the claim):
Non-statutory rectification
The law of probate gave the court limited de facto powers to rectify a will by excluding from the will any part which was inserted by fraud or which for some other reason was inserted without the testator’s knowledge and approval (Marley v Rawlings [2014] and Re Morris [1971] referred to). While no application was made to amend the claim form to rectify this will under this doctrine, it would have been open to C to argue that the will could have been rectified to remove the words ‘in equal shares absolutely’. This would have led to an ambiguity and the court could then have admitted extrinsic evidence of PK’s testamentary intentions to cure this ambiguity under s21 AJA 1982. The claim form sought ‘such further or other relief as the court thinks fit’ – had the court refused to rectify under s20 AJA 1982, it could have granted relief via this more circuitous route.
Is there a clerical error in the will for the purposes of s20(1)(a) AJA 1982?
The court was satisfied that a handwritten note dated 5 July 2010 was a contemporaneous record of the solicitor made during a meeting with PK when he gave instructions to prepare the will. The court also accepted that a typed-up version was an accurate and more legible record of the meeting.
PK wished to divide the residue into six equal shares and divide them between Eileen, Kathleen, Michael, Vincent, John, and the last sixth was to be divided equally between Maureen’s five children. His testamentary intentions were clear. Due to a clerical error, the will simply listed all ten beneficiaries and added ‘in equal shares absolutely’. The effect was to divide the residue into ten shares and not six. This was a clear clerical error and a strong case for rectification.
The effect of the error, if not rectified, was that the five defendants would receive an unintended windfall.
The court accepted that C’s proposed wording would reflect PK’s testamentary intentions.
Where was PK’s domicile at the date of his death?
The court accepted C’s evidence that PK had intended to live in England indefinitely and had no intention to return to Ireland. This was supported by other evidence: PK lived in England from 1976 until his death in 2014, he purchased the flat in 2009 which was his home, the vast bulk of his assets were in England, he only visited Ireland occasionally and stayed with family when he did so, his social life was in London and he regarded London as his home, he sold the family house in Ireland in 2010 only retaining some family land and an uninhabitable cottage, and he worked in England until 1992 and remained living in London post-retirement until his death.
PK had therefore acquired an English domicile of choice and had been domiciled in England when he died and when he gave will instructions in 2006. There was no evidence that he had abandoned this domicile of choice, and therefore he was domiciled in England when he gave will instructions in 2010. No weight was to be placed on the fact that the wills gave addresses in Ireland when the overwhelming factual evidence was that PK had settled in London indefinitely.
Rectification did not sit easily within the rules concerning conflicts of laws cited by C and was not addressed in the passages from the textbooks cited to the court. In terms of best fit, rectification is ‘more obviously’ analogous to the examples given in relation to essential validity (under which essential validity of a will of movables is governed by the law of the testator’s domicile, and essential validity of a will of immovables is governed by the lex situs). This applies whether it is the residual common law power of rectification, or rectification under s20 AJA 1982. Therefore, save for the land in Ireland which was unaffected by the claim to rectification, the issue in respect of the will was to be determined in accordance with English law.
If this analysis was wrong, the court considered that the law of the deceased’s domicile on the date of the will applied to rectification as it did to the interpretation of the will (Re Cunnington [1924] referred to). Where relevant, s49 Administration of Estates Act 1925 applied to any partial intestacy, but where any of PK’s siblings named in the will predeceased him leaving issue, s33 Wills Act 1837 applied so that the issue would take in place of their parent. These were examples of English statutory law applying to the 2010 will and there was no logical reason why s20 AJA 1982 should not also apply.
It was difficult to see why English law should not apply to the claim. The 2010 will had been admitted to probate to give effect to PK’s testamentary intention. The court was concerned with the application of AJA 1982 to the administration of an estate in England. This was consistent with wider principles of private international law and the autonomy of PK in selecting England as his country of domicile. It made sense for the law of his domicile to determine issues of essential validity and construction, in respect of movables, including this claim for rectification. If it were not the case, the court would treat a case where the instructions named nine beneficiaries but the will named ten (when the reference to the tenth could be omitted as a matter of essential validity or construction) differently from a case where the instructions named ten beneficiaries but the will named nine.
The English law on rectification, whether at common law or under s20 AJA 1982, therefore applied to the will.
Should an extension of time be granted?
It is ‘right to be cautious’ when applying principles relevant to extension of time under s4 Inheritance (Provision for Family and Dependants) Act 1975 (IPFDA 1975) to applications for extensions of time in which to bring a claim for rectification under s20 AJA 1982 (Re Salmon [1981], Chittock v Stevens [2000], and Berger v Berger [2014] referred to). To simply align the guidelines would disregard the fundamentally different nature of these claims. A claim under IPFDA 1975 can effectively drive a coach and horses through testamentary intention, while a claim under s20 AJA 1982 seeks to find the true testamentary intention and give effect to it. While s20(3) AJA 1982 is analogous to s20 IPFDA 1975, s20 AJA 1982 is and should be more flexible than IPFDA 1975. There is also the additional point that a rectification claim is often an alternative to a claim for a declaration as to the true meaning of the will, which is subject to no time constraint or protection for the executor. If there were too restrictive an approach to the time limit in s20 AJA 1982, a court might, in trying to achieve a result where the will reflected the testamentary intentions, strain too far in interpretation which could lead to an executor being exposed many years after distributing on the wrong basis.
Cowan v Foreman [2019] offers important guidance albeit in the context of s4 IFPDA as to the nature of the six month time limit and the correct approach of the court to it. There is also a clear argument to take a more flexible, but still principled, approach to applications under s20 AJA 1982.
The relevant considerations were that the burden was on C to show sufficient grounds for bringing the claim after the expiry of six months from the date of the grant of probate; whether C had acted promptly and the circumstances in which he applied for permission; whether negotiations were begun within the time limit; whether PK’s estate had been distributed before the claim was notified to Ds; whether refusal would leave C without recourse to other remedies; and whether C had an arguable case under s20(1) AJA 1982.
Shortly after probate was granted, C and Ds entered into negotiations but these had broken down by May 2016. C had obtained an English opinion on 8 April 2015 which had advised that there was a strong case for rectification if the will was an English will but that rectification might not be available if it was an Irish will. At this stage it was not straightforward what action C should take as executor.
C’s initial view had been that, in the absence of agreement, he had no choice but to accept the will as drafted. In June 2016, family members brought a negligence claim against PK’s solicitors and, on 19 April 2017, the solicitors’ solicitors informed them that they had obtained English counsel’s opinion that rectification was available under s20 AJA 1982. This led to a decision in November 2017 to pursue the rectification claim. No distribution had been made. While in a letter dated 31 May 2016 C’s solicitors had said that the estate would be distributed in accordance with the will, they subsequently said that no distribution could take place until the assets in Ireland were received (which occurred in April 2017), and on 19 May 2017, Ds’ solicitors were notified that PK’s solicitors had raised an issue which had to be considered before distribution. A letter of 17 November 2017 notified Ds that there would be a will construction claim in England.
D4 argued that the delay between May 2017 and May 2018 was unexplained. The court found that between May 2017 and November 2017 the claim was being evaluated and issues surrounding funding were being resolved. The court also found that there was no explanation for the delay between November 2017 and the issue of the claim, and that there was no reason why C’s solicitors should not have explained the position to Ds’ solicitors much earlier and more fully. However, C did not need to have a good reason for every period of delay. D4 also pointed out that there was no standstill agreement, but this was only one of the circumstances of the case to be taken into account.
The lack of distribution was an important factor (Pengelly v Pengelly [2007] and McNulty v McNulty [2002] referred to). D4 argued that the estate was only undistributed in the sense that the beneficiaries did not have the cash in their own hands, while the estate was fully administered and the accounts settled by 11 April 2017. This however was an overly technical approach which is not correct as a matter of principle or policy. Executors and beneficiaries need certainty – this is why the time limit is in place – but there is also a power to extend time under s20(2) AJA 1982. Here there is no distribution and no need to recoup any money from Ds. The factors identified in Re Salmon and summarised in Berger do not equate an expectation of receiving a distribution with an actual distribution. The former and any change of position arising therefrom are specifically dealt with under the consideration of prejudice.
Prejudice to D3 and D4 was not an overwhelming factor. D4’s counsel conceded that his evidence was ‘not as full as might have been hoped’. Ds had initially been prepared to agree to receiving a one-sixth share albeit on condition that C did not recover the full extent of his expenses. While they were told they would receive a distribution in accordance with the will in May 2016, they were aware that no distribution would take place until the Irish assets were got in, which took place in April 2017. By 19 May 2017, Ds were notified, albeit with scant information, that there would be no distribution until a point raised by PK’s solicitors had been considered. D4 claimed that he had had to postpone decisions, but no details were given and that prejudice would arise whether he received one-tenth of the estate or a share of one-sixth. D3 offered even less information. There was no evidence that D3 or D4 had taken on debt or changed their position. At most their evidence amounted to frustration in not receiving an inheritance from PK’s estate yet.
The claim was substantively strong and indeed, it was difficult to see how it could be resisted on the merits.
D4 argued that the claim was barred by acquiescence because the accounts were settled and C’s solicitors had stated that the estate would be distributed in accordance with the will. However there was no evidence that C or the other beneficiaries knew about the extent of their rights until April or May 2017. To make good this argument, D4 needed to show that C had full knowledge of the facts and possibly their legal consequences. C had taken advice as executor and that advice was that a claim could not be brought for rectification because the will was Irish (which was wrong). It was difficult to see how concurrence as executor to a distribution based on a false premise could bar C’s claim as a beneficiary.
C had an alternative remedy (a negligence claim against PK’s solicitors) and indeed reached the stage of seeking judgment in default. However judgment had not been entered, and while breach might be clear there were obvious arguments about whether C and the other beneficiaries had mitigated their loss properly. Obtaining judgment in full was not necessarily straightforward. This was only one factor and not the determinative one.
Standing back and asking whether it was just and proper in all the circumstances to extend time, the answer was ‘an undoubted yes’. Negotiations were initiated around the time that probate was granted. C had given an explanation for the delay. There had been no distribution. Other than assertion, there was no evidence of prejudice other than a delay in distribution. The claim was extremely strong and the existence of an alternative remedy did not tilt the balance against permission. There should be a more flexible approach in claim under s20 AJA 1982 than under s4 IPFDA but the factors were so strong that the court did not need the extra flexibility.
JUDGMENT MASTER SHUMAN: [1] This is a claim for rectification of the will of Patrick Joseph Kelly (‘the deceased’) dated 5 July 2010 (‘the 2010 will’). It is made pursuant to s20(1)(a) of the Administration of Justice Act 1982 (‘the 1982 Act’). As six months has expired between the claimant being granted probate on 7 …Continue reading "Kelly v Brennan & ors [2021] WTLR 613"