Balwant Singh Gill v Jashpal Singh Thind
| Jurisdiction | England & Wales |
| Judge | Lord Justice Arnold,Lady Justice Asplin,Lord Justice Peter Jackson |
| Judgment Date | 02 November 2023 |
| Neutral Citation | [2023] EWCA Civ 1276 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: CA-2022-002478 |
[2023] EWCA Civ 1276
Lord Justice Peter Jackson
Lady Justice Asplin
and
Lord Justice Arnold
Case No: CA-2022-002478
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE, BUSINESS AND PROPERTY
COURTS OF ENGLAND AND WALES, BUSINESS LIST (ChD)
David Halpern KC sitting as a Deputy High Court Judge
Royal Courts of Justice
Strand, London, WC2A 2LL
Donald Lilly and William Stewart-Parker (instructed by CANDEY) for the Appellant
John Randall KC and Robert Mundy (instructed by George Green LLP) for the Respondents other than the Third Respondent to the Petition
The Third Respondent to the Petition did not appear and was not represented
Hearing date: 24 October 2023
Approved Judgment
Introduction
This is an appeal by the Claimant and Petitioner, Balwant Singh Gill (“Mr Gill”), against paragraphs 3–9 and 11–12 of an order made by David Halpern KC sitting as a Deputy High Court Judge on 7 December 2022 for the reasons given in his judgment dated 14 November 2022 [2022] EWHC 2872 (Ch). By those paragraphs of his order the judge declared that Mr Gill holds 100 shares in the Third Respondent to Mr Gill's petition, Jeeves Estates Ltd (“JEL”), on trust for the first six of his grandchildren and made various consequential orders.
The order was made by the judge following an 11 day trial of a Part 7 claim and a petition under section 994 of the Companies Act 2006. The proceedings arose out of an unfortunate family dispute between Mr Gill on the one hand and his daughter, the Second Defendant and Respondent, Baljit Gill Thind (“Mrs Thind”), and her husband, the First Defendant and Respondent, Jashpal Singh Thind (“Mr Thind”), on the other hand. The dispute concerned the beneficial ownership of shares in three family companies: JEL, Jeeves Investments Ltd (“JIL”) and Simicare Ltd (“Simicare”). Mr Gill claimed that he was legally and beneficially entitled to the sole issued share in each of JIL and Simicare and to one third of the issued shares in JEL. Mr and Mrs Thind's case was that Mr Gill received the JIL and Simicare shares on trust for their children (Avneesh Singh Thind, Jeevan Singh Thind and Simran Kaur Thind, who I will refer to by their first names) and that he received 100 of the 300 shares in JEL on trust for all his grandchildren.
The judge found that Mr Gill had received the JIL and Simicare shares on trust for the Thinds' children and that Mr Gill had received 100 of the 300 shares in JEL on trust for all his grandchildren (although the judge went on to hold, for the reasons he gave in a consequential judgment dated 7 December 2022 [2022] EWHC 3651 (Ch), that, by virtue of the class-closing rule in Andrews v Partington (1791) 3 Bro CC 401, 29 ER 610, only the first six of Mr Gill's grandchildren were beneficiaries of that trust).
Mr Gill does not challenge the judge's decision so far as it concerns JIL and Simicare, but he appeals with permission granted by Snowden LJ against the decision with respect to JEL. Although JEL is formally a respondent to the appeal, the principal respondents are Mr and Mrs Thind.
Background
The family
Mr Gill is in his eighties. He has four children: Kamaljit Kaur Khela, Mrs Thind, Ranjjett Benning and Kuldeep Gill (“Kuldeep”). Mr Gill currently has eight grandchildren born between 1983 and 2021. It is common ground that the family was a very close one until about the beginning of 2018, but since then a split has emerged with Mr Gill, Mrs Khela, her husband Kundan Singh Khela and Kuldeep in one camp and Mr and Mrs Thind and Mrs Benning and her husband Dave Benning in the other camp.
The companies
Mr and Mrs Thind run various businesses in the South-East of England, mostly through companies named after their children.
In 1999 Mr and Mrs Thind bought a pharmacy business in Brighton through Aveycare Ltd, named after Avneesh. In 2004 they bought an investment flat in East London through JIL, named after Jeevan.
In 2006 Mr and Mrs Thind bought nursing home premises (“the Laurels”) in Hastings through JEL, also named after Jeevan, and the business run from those premises through Laurels Nursing Home (Hastings) Ltd (“LNH”). LNH later became a subsidiary of JEL.
To fund the purchase, Mr Gill provided £133,000 and Mr and Mrs Thind provided £267,000. The judge found that (as was Mr and Mrs Thind's case, but contrary to Mr Gill's case) these were interest-free loans, and that finding is not challenged by Mr Gill. Abbey National Building Society provided a mortgage loan of a little under £1m, secured by personal guarantees given by Mr and Mrs Thind, but not Mr Gill. Mr Gill was later repaid £108,000.
In 2011 Mr and Mrs Thind bought nursing home premises (“St Margaret's”) in Hythe and the associated business through Simicare, a company named after Simran.
In 2012 Mr and Mrs Thind bought nursing home premises (“Sherwood House”) through their SSAS Pension Fund and the associated business through Watts Healthcare Ltd (“WHL”). WHL then became a subsidiary of JEL. Mr Gill provided £280,000 to WHL between 2012 and 2014. The judge found that this too was a loan (as again was Mr and Mrs Thind's case, but contrary to Mr Gill's case), and again that finding is not challenged by Mr Gill. Mr Gill was repaid £250,000 between 2015 and 2016.
Ownership issues
Aveycare. Although Mr Gill lent money to Mr and Mrs Thind to help them buy the Brighton pharmacy, there was no dispute that they were the legal and beneficial owners of Aveycare.
JIL. JIL had one issued share. JIL's first annual return gave the name of its shareholder as “Mr and Mrs B S Gill (Trustees)”.
Mr and Mrs Thind's case was that Mr Gill agreed in 2004 to hold the share in JIL on trust for their children and that he much later signed a written declaration of trust in favour of Avneesh and Jeevan.
Mr Gill's original case was that the shares in JIL were held by trustees for himself and his wife Baljinder Kaur Gill or by trustees for their pension fund. After being forced to admit that there was no such pension fund, he abandoned both these contentions. By the trial, his case was that the company's single share belonged to him in law and equity. He said that the written declaration of trust was a forgery. The judge found that Mr Gill was right that the declaration was a forgery, and there is no challenge to that finding by Mr and Mrs Thind.
JEL. According to JEL's 2008 annual return, as at November 2007, Mr Gill was registered as holding 100 shares in JEL and Mrs Thind 200 shares.
The dispute concerned the terms on which Mr Gill held the shares in JEL. The judge described the parties' cases at [18] in this way:
“(1) Mr Gill's evidence is that he agreed to enter into a joint venture with Mr and Mrs Thind in relation to The Laurels and he therefore owns his shares absolutely. He says in his trial witness statement that Mr Patel advised him to take £108,000 out of the business; it is not clear whether he is saying that he was advised to take it as a dividend. He accepts that he has not paid tax on this money, but he blames Mr Povey who prepared his tax returns.
(2) Mr Thind's evidence is that, during a family gathering in December 2005, he told Mr Gill about the Thinds' plan to buy The Laurels and to borrow part of the purchase price from the Bank. He says that Mr Gill replied: ‘ I will lend you the money but give it to the grandchildren, one third of it’. The cash contribution for the purchase was £400,000, and Mr Gill lent £133,000.”
Mr Gill relied in support of his case on an option agreement concerning the shares in JEL signed by Mr Gill and Mrs Thind on 8 September 2011 (“the 2011 Option”). The significance of the 2011 Option is that (i) it expressly refers to Mr Gill owning 100 shares and Mrs Thind owning 200 shares, (ii) it makes no reference to any trust and (iii) it provides for each party to have the option to buy the other's shares in the event of the latter's death.
Simicare. Simicare had only one issued share, held by Mr Gill from 2012.
Mr and Mrs Thind's case was that, at dinner at Nando's in Bluewater in April 2010, Mr Thind told Mr Gill that Mr and Mrs Thind were thinking of buying St Margaret's for the benefit of their children and Mr Gill agreed to act as trustee. Their case was that Mr Gill later signed a written declaration of trust.
Mr Gill's case at trial was that he was unaware that the share had been put in his name, but nevertheless it belonged to him in law and equity. Mr Gill again said the written declaration of trust was a forgery. Again the judge found that he was right about the declaration, and there is again no challenge to that finding by Mr and Mrs Thind.
Simicare paid dividends into a Nationwide Building Society account in Mr Gill's name. That account was only used to pay Avneesh, Jeevan and Simran's school fees. Mr and Mrs Thind argued that this supported their case that Mr Gill had agreed to act as a trustee of the Simicare share. Mr Gill said he knew nothing about the Nationwide account. His counsel floated the idea of some unspecified tax fraud, but the judge rejected that suggestion.
Management issues
In addition to the issues as to the ownership of the shares in JIL, JEL and Simicare, Mr Gill complained about how those companies (and their subsidiaries) were managed.
The witnesses
Mr Gill
Mr Gill gave evidence for one day, but did not return to court to...
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