Claire Henchley and Others v David Brian Thompson
| Jurisdiction | England & Wales |
| Judge | Chief Master Marsh |
| Judgment Date | 16 February 2017 |
| Neutral Citation | [2017] EWHC 225 (Ch) |
| Docket Number | Case No: HC-2016-001901 |
| Court | Chancery Division |
| Date | 16 February 2017 |
[2017] EWHC 225 (Ch)
Chief Master Marsh
Case No: HC-2016-001901
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
IN THE MATTER OF THE N E HENCHLEY TRUST AND THE W C C HENCHLEY TRUST
Royal Courts of Justice
Rolls Building, 7 Rolls Buildings
Fetter Lane, London EC4A 1NL
Richard Wilson QC and James Weale (instructed by Withers LLP) for the Claimants
Elspeth Talbot Rice QC and Andrew Holden (instructed by Carter-Ruck Solicitors) for the Defendant
Hearing date: 5 December 2016
The Claimants are the beneficiaries of two trusts created by the late WCC Henchley dated 1 September 1960 and 12 September 1960. He died in 1972. By this claim the Claimants seek an order directing the Defendant to provide a full account of his dealings with the assets of the two trusts as a trustee or as a de facto trustee. I have used the latter description of the role he is said to have performed, if he had not been properly appointed as a trustee, in preference to describing him as a trustee de son tort. Both descriptions are opaque but, as Lord Millett remarked in Dubai Aluminium v Salaam [2003] 2 AC 366 [at 138], it is preferable to substitute dog Latin for bastard French.
Mr Henchley was married twice and had children by both marriages. He had two children by his first marriage to Vera, named Patricia and Vivien. Patricia is married to the Defendant. By his second marriage to Nancy, Mr Henchley had four children, Julian, Elizabeth, Claire and Alexander. Vivien, Elizabeth and Claire together with Vivien and Claire's children are the Claimants. I will refer to them throughout this judgment, where necessary, using their given names. By doing so, of course, I intend no disrespect. It is merely a convenient shorthand.
The NE Henchley Trust ("The Henchley Trust") was settled by a deed dated 1 September 1960. It provided for the trust's assets to be held for Nancy, the settlors' wife, for her life and thereafter for the settlors' children. The two principal clauses of the settlement provided as follows:
"1 THE Trustees shall hold the property upon trust that the Trustees shall with consent in writing of the Settlor during his life and after his death with the consent in writing of the wife during the remainder of her life or until her remarriage and after the death of the survivor or on their remarriage of the wife at the discretion of the Trustees sell the same at such time or times as the Trustees shall think proper so that they shall have full power to postpone the sale of all or any part thereof without being responsible for any loss which may result therefrom.
2 The Trustees shall hold the net proceeds of sale and any other monies applicable as capital and the net rents and profits until sale on trust for the wife during her life or until her remarriage and after her death or remarriage upon trust for the children of the Settlor then living if more than one equal shares absolutely and if any child shall then have died leaving issue him or her surviving such issue shall the share in the trust fund which his or their parent would have taken if he or she had been living and if more than one in equal shares absolutely."
The principal asset of this settlement was initially a property known as Greyfriars, Cockfosters Road, Enfield. Greyfriars was sold and a property known as San Michele was purchased. That property was sold and 395 Cockfosters Road, Whaddon Lodge was purchased and it remains within The Henchley Trust and is where Nancy resides. It is clear there was at one time other assets held in The Henchley Trust. There is evidence of trust bank accounts and a modest portfolio of investments was referred to in a deed dated 20 November 1972. Under that deed Nancy purported to exercise a power of appointment to appoint the Defendant as a new trustee to The Henchley Trust. The appointment was treated as valid by all concerned until 1998. On 27 October 1998, Eversheds, stating they were writing on behalf of "members of the Henchley family", wrote to the Defendant to say that the deed was invalid. The Defendant executed a deed describing himself as the "purported trustee" and reciting that the deed of appointment was invalid. The deed made provision for him to retire as a trustee in so far as he was validly appointed. However, title to 395 Cockfosters Road remained registered in the Defendant's name until April 2011. On 11 March 2013 Patricia, Julian and Alexander executed a deed of confirmation by which, amongst other things, they assigned their reversionary interests to Elizabeth, Vivien and Claire and other beneficiaries assigned their contingent reversionary interests to them. This deed tidied up a number of previous efforts to achieve that objective, including an agreement made on 5 February 1991.
The second settlement is the WCC Henchley Trust ("The Childrens' Trust") which was created by the settlor on 12 September 1960. The settlement deed has not survived but there is no dispute about the terms of the trust because its terms were referred to in a letter from Julian to the Defendant dated 9 December 1991. In summary:
i). The assets of the trust were to be divided into two parts.
ii). Julian and Alexander were entitled to the capital of one such half outright upon reaching the age of twenty-one.
iii). As to the other half, Elizabeth, Vivien and Claire were entitled to an equal share of the income for their lifetime. Thereafter, their children and their children's children would be entitled to that income pending the dissolution of the trust twenty-five years after the death of "Prince Edward".
Mr Henchley's will made no provision for his children on the express basis that they were already provided for under the terms of The Childrens' Trust and the will records that Mr Henchley had settled as trust assets his shares in Fullers Studios Limited, Renoir Litho Limited, Renoir Display Limited and Tru-Tone Photo Litho Limited ("the Companies"). These were all family businesses which were run by Mr Henchley up to his death.
Although no document evidencing the Defendant's appointment as a trustee of The Childrens' Trust in 1972 following Mr Henchley's death, it appears he was so appointed. The Defendant was also appointed a director of the Companies. In any event, there is no real doubt that he performed the role of a trustee of The Childrens' Trust until at least the early 1990's.
It is also clear in relation to The Henchley Trust that Doris Watson and Walter Martin were validly appointed as trustees of that trust. Mr Martin died on 26 February 1996 and Ms Watson died on 3 March 2003. Such documents as there are suggest they were also trustees of The Childrens' Trust along with the Defendant.
In any event, even if the Defendant was not properly appointed as a trustee of the two trusts, he acted as a de facto trustee for lengthy periods. There is the possibility that Nancy was a trustee of The Childrens' Trust at one time. The evidence for this is, however, slight.
The Defendant is now aged eighty. During the 1970's he and Harry Solomon founded Hillsdown Holdings which was floated on the London Stock Exchange in 1985. He retired from the board of Hillsdown Holdings PLC in 1989 at the age of fifty-three and sold the balance of his shares which yielded several hundred million pounds. He has created a charitable trust and has been a sole donor of assets to that trust which has given away over £20,000,000 to registered charities and has an endowment of over £110,000,000 to give away in the future.
The Defendant says he was asked to assist Nancy following the death of Mr Henchley because he was an experienced businessman. Nancy was a director of the businesses owned by The Childrens' Trust and the Defendant was asked to take a role advising those businesses. The extent to which the Defendant played an active role in relation to those businesses and The Childrens' Trust (and indeed The Henchley Trust) is a matter which is in dispute.
There are a considerable number of disputed issues of fact relating to both trusts. The disposal hearing of the Part 8 claim took place without any evidence being tested by way of cross-examination and it would not be right for the court to draw conclusions where there are issues in dispute save in the few instances where the documents provide an unequivocal answer or the answer is otherwise entirely plain. I also remark that the way in which the evidence has emerged is not entirely satisfactory. Claire, the first Claimant, made a witness statement in support of the application which provides a summary of the relevant background but it did not exhibit all the documents in her possession that are relevant to the trusts. The Defendant provided what can fairly be described as a forthright witness statement in response which was then met with a further statement from Claire challenging some of the assertions he made and producing further documents which cast doubt on his account of events. The Defendant made a statement dealing with the additional evidence in which he recorded his disquiet about the approach adopted by Claire on behalf of the Claimants. It will be necessary in this judgment to refer to the evidence in some detail but I record at this stage that I do not regard either the tone or some of the language adopted, particularly by the Defendant, to have been helpful.
Put shortly, the Claimant's case is that the Defendant was either an actual or de facto trustee of both trusts and the Claimants are to entitled, as of right, to an order that the Defendant provides an...
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