Daniel v Drew
| Jurisdiction | England & Wales |
| Judge | Lord Justice Ward,Lord Justice Buxton,Mr Justice Wilson |
| Judgment Date | 06 May 2005 |
| Neutral Citation | [2005] EWCA Civ 507 |
| Docket Number | Case No: A3/2004/2010 |
| Court | Court of Appeal (Civil Division) |
| Date | 06 May 2005 |
[2005] EWCA Civ 507
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE CHANCERY DIVISION
His Hon. Judge Weeks Q.C.
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Ward
Lord Justice Buxton and
Mr Justice Wilson
Case No: A3/2004/2010
Mr William Batstone (instructed by Messrs Wilsons) for the Appellant
Ms Penelope Reed (instructed by Messrs Burges Salmon) for the Respondent
Introduction.
This is an unusual family dispute. Aged aunt alleges that her nephew procured her resignation from a family trust by undue influence. On 2 nd September 2004 His Hon. Judge Weeks Q.C. sitting as a deputy judge of the Chancery Division found for her and ordered that a memorandum signed by her dated 20 th February 2002 and the deed of retirement made between her and her nephews dated 25 th February 2002 be set aside. He gave the nephew permission to appeal.
The background facts in more detail.
The case concerns Hyde Farm, a farm of some 116 acres near Fordingbridge in Hampshire. Mr and Mrs Spicer lived and farmed there for some 50 years until Mr Spicer died in 1969. He left the farm to his wife for life and then to his two daughters in equal shares. The daughters are the claimant, Mrs Irene Margaret Drew, whom, for convenience and I hope not discourteously I shall sometimes call Aunt Margaret, and her elder sister, Mrs Muriel Daniel. At some later time Muriel gave her interest in the farm to her sons, the defendants, Nicholas and Jeremy Daniel. Since Mrs Spicer was elderly and incapable of looking after herself Mr and Mrs Drew went to live at Hyde Farm and maintained the farm for her until her death in 1982. Mr and Mrs Drew continued to farm the property rent free until 1987. Then Nicholas, as I shall refer to the appellant, took over.
On 23 rd February 1988 Mr and Mrs Drew, as surviving executors of the late Tom Spicer assented to the vesting of Hyde Farm in Aunt Margaret, Nicholas and Jeremy on trust for sale to hold the net proceeds of sale as to half for Aunt Margaret and as to one quarter each for Nicholas and Jeremy. On 21 st March 1988 the trustees of this Assent granted a yearly agricultural tenancy of Hyde Farm to Nicholas at a rent of £1 per annum fixed for five years to reflect the fact that Mr and Mrs Drew had been in rent-free occupation for the previous five years.
On 12 th March 1990, Mrs Drew, now a widow, assigned her beneficial interest to her son Stephen. Thereafter she took no part in the business of Hyde Farm and her son, Stephen, acted as de facto trustee in her place. No-one at first questioned his doing so: after all the sons had stepped into their mothers' places and may well have been content to deal with each other for the sensible reason that they were co-owners of the property.
Trouble arose when Nicholas's rent free period expired and Stephen began to ask for rent. There were arguments about the farm falling into disrepair. Matters came to a head in May 1999 when Stephen served a notice on his cousin Nicholas asking for an arbitration as to rent. Nicholas disputed Stephen's authority to serve the notice and served his own notice requiring arbitration as to repairs.
Nicholas had begun to demand of Aunt Margaret that she attend meetings of the trustees but she was unwilling to attend to business matters which she told the judge made her legs ache.
Solicitors were instructed and a compromise was negotiated subject to contract under which Nicholas and Jeremy would buy out Stephen's interest and Aunt Margaret would retire as trustee. A deed of resignation and a deed of assignment were drafted by Messrs. Wilsons acting for Nicholas and Jeremy and sent on 7 th December 2001 to Messrs. Burges Salmon acting for Stephen. On 5 th February 2002 Burges Salmon told Wilsons that Stephen had decided, as he was entitled, not to sell his interest in Hyde Farm. As the judge remarked, "Understandably Mr Nicholas Daniel felt frustrated by this turn of events".
The events leading to Aunt Margaret's "resignation".
Mrs Muriel Daniel regularly visited her sister on Wednesdays. She did so on Wednesday 20 th February 2002 but unusually took her son Nicholas with her despite her knowing that Margaret would not have admitted Nicholas on his own because she refused to discuss business matters with him. Margaret did not deny Nicholas entry when he attended with his mother. They stayed for about twenty minutes.
The judge found that both Mrs Drew and Mrs Daniel were totally honest witnesses trying to tell the truth as they remembered it but he concluded:—
"… Given their age" [Aunt Margaret was 85 years old at the time of the trial] "and the fact that the events occurred over two years ago, I do not think that their recollection is wholly reliable. Mrs Drew in particular, towards the end of her evidence, was showing signs of confusion."
As for Nicholas he said:—
"I did not find him a completely credible witness."
The judge made these important findings:—
"Mr Nicholas Daniel wanted to speak to his aunt about repairs to the farmhouse, and, knowing that his aunt did not wish to see him, he arranged for his mother to visit her first. He did talk to her about the repairs needed to the farmhouse, and he did remind her of her duties as trustee. I do not think that he shouted or threatened her, but he did say that if she did not accept her responsibility the matter would have to be resolved in court.
Mrs Drew intensely disliked any form of confrontation. She was afraid of her nephew, and frightened by the prospect of court. As a way out, she told him, untruthfully, that she thought she had already resigned. Mr Nicholas Daniel seized on this, knowing that it was not true, and asked her to put it in writing. She was cornered and felt unable to refuse. He drafted a short statement of resignation and came back in the afternoon with Mr Panton [a neighbour of Nicholas] and she signed."
That document recorded:—
"I Mrs I.M. Drew of The Firs Frogham hereby give notice that from this day the 20 th February 2002 I resign as Trustee/Landlord of Hyde Farm Hyde Lane Stuckton Fordingbridge Hampshire.
Signed I.M. Drew.
Witnessed Steve Panton."
On the following Sunday Margaret told her good friend, Mrs Wort, that as Mrs Wort recalled it:—
"Margaret told me that Nick said she would have to resign as a trustee of the farm if she refused to discuss farm matters with him, or he would take her to court. She also told me it had been a very unpleasant experience for her and that Nick threatened her with court action if she did not sign this document."
There was "a striking disparity", for which there was "little scope for genuine error", between Nicholas's first witness statement and the version he gave in his defence verified as true in his oral evidence about what happened next. The judge found that on the following Monday, 25 th February, Nicholas told his solicitor at Wilsons that Aunt Margaret had signed this document. He was advised, however, that the resignation was invalid because it had to be done by deed and he was reminded that a draft deed of resignation had been prepared a few months previously. Nicholas asked the solicitors to email him a copy which they did. He printed it out and went back to his aunt the same day 25 th February before lunch. The judge found this:—
"Aware that if his cousin, Stephen, or Messrs Burges Salmon had an opportunity to advise Mrs Drew, the resignation would not proceed, Mr Daniel chose not to instruct Wilsons to send another draft to Burges Salmon but asked them to send a copy to himself instead. On the same day, he went to his aunt's cottage twice with the deed. On the first occasion, he was not admitted. On the second occasion he went with Mr Joint and was admitted on his own. He spoke to his aunt for a long time before Mr Gregory intervened.
On his own account, Mrs Drew raised the question of Stephen being appointed trustee in her place. According to Nicholas:
"I then reminded her of what her solicitor, Mr Ricketts of Trethowans, had said to me on the telephone to the effect that the trust deed had apparently provided that in the event of Mrs Drew ceasing to be a trustee she would not be replaced as trustee, and that this provision had been put in the trust deed at Mrs Drew's own request."
Whatever Nicholas may have been told, that advice was incorrect. There was no provision in the assent preventing Stephen's appointment but, as continuing trustees, the other two would, of course, have been in a position to block it. Mrs Drew would therefore have been ill advised to resign without securing agreement as to her successor."
Mr Gregory was Margaret's next door neighbour living in the other half of a semi-detached pair of cottages. He is a retired civil servant and he and his wife, conscious of Margaret's frailty, "keep an eye open for any unusual events such as unfamiliar vehicles parked outside her house." He did not recognise the four-wheel drive vehicle outside the cottage nor the gentleman, Mr Joint, who was sitting in it. Mr Joint was there at Nicholas' request to witness Margaret signing the deed. He decided to investigate. The judge was most impressed by him. He gave evidence that:—
"I was immediately aware of the tension in the room. Margaret was clearly very distressed, looking worried and uncomfortable and, from the redness around her eyes, I thought perhaps close to tears. Although Margaret was obviously upset, I felt I should not intrude in what seemed to be a family affair. I assessed the situation for a few...
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