James Frederick Driver and William Henry Driver v Derek Alfred Yorke and Madelaine Elizabeth Driver

JurisdictionEngland & Wales
JudgeHis Honour Judge Bowsher QC
Judgment Date07 April 2003
Neutral Citation[2003] EWHC 746 (Ch)
CourtChancery Division
Docket NumberCase number: HC 02 C02 147
Date07 April 2003

[2003] EWHC 746 (Ch)

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

His Honour Judge Bowsher QC

Case number: HC 02 C02 147

Between
James Frederick Driver and
William Henry Driver
Claimants
and
Derek Alfred Yorke and
Madelaine Elizabeth Driver
Defendants

I direct that no further note or transcript be made of this judgment

His Honour Judge Bowsher QC His Honour Judge Bowsher QC

Introduction

1

This action arises out of a sad family quarrel over a small inheritance. The motivation for bringing the action appears to be ill-feeling rather than a desire for material gain. As a result, when I expressed the view at the beginning of the trial that the costs of the trial would be likely to be far in excess of the value of the estate and that no one would benefit except the lawyers, that view appeared to be accepted by the members of the Bar in court but, after a short adjournment, they were unable to persuade their clients to agree to a settlement.

2

It is not apparent on the face of the particulars of claim because the prayer claims an account and various other forms of chancery type relief, but this is actually a claim for less than £20,000. If the claimants are right, they are entitled as beneficial owners to the net proceeds of sale of a leasehold maisonette that was sold for £62,000. The father, the testator, had the legal title to the leasehold. The executor sold the maisonette and after paying off the mortgage on the maisonette and paying out certain legacies and expenses sought to distribute the residue between the testator's two sons (the claimants) and their sister (the second defendant). The claimants rejected a cheque for £13,339.13 offered to each as the one-third share of the estate for each and claim the whole net proceeds of the sale of the maisonette—in other words, they claim the one-third paid to their sister, £13,339.13. The value of their claims is a little under £7,000 each.

3

I shall refer to the parties by the names used generally in the trial, namely, the claimants as Jim and Bill and the defendants as Mr Yorke and Madelaine. The deceased parents were Jonathan and Mildred.

Background

4

The claimants are brothers and the second defendant is their sister. The first defendant is the executor of the last will of their father. The first defendant is not related to the other parties but he was at one time (but not now) living with the second defendant.

5

This is a family dispute as to the leasehold ownership of a maisonette property at 188 Stroud Crescent, London ("the property") owned in law by Jonathan, who died on 3 October 1998. Derek Yorke, the first defendant, is the executor of Jonathan's last will dated 13 March 1998.

6

The property was purchased by Jonathan and Mildred in about June 1987 for £14,750 from the London Borough of Wandsworth under the "right to buy" provisions of Part V of the Housing Act 1985 (see the letter of 2 June 1987 from Russell Cooke, Potter and Chapman, solicitors). The discount (which belonged solely to Jonathan and Mildred) was just under two-thirds of the property's value, the true value of the property being £40,000.

7

When Jonathan and Mildred were living in the property as tenants they paid the rent without assistance from their children. Jonathan was a retired engineer and they were living off his old age pension and two small pensions from previous employers. They did not have the money with which to take advantage of the "right to buy" provisions and because of their age they could not obtain a loan on mortgage without a guarantor standing behind them. The family was a very close and loving family and Jim and Bill made a proposal to enable Jonathan to obtain a mortgage to take advantage of what has been called the windfall offered by the "right to buy" provisions. The terms of that proposal are hotly in dispute in this action. Had she been in a normal state of health and competence, Madelaine would no doubt have joined in the scheme, but she had recently been through a divorce and had a nervous breakdown as a result and sold her hairdressing business and she had no money: so the arrangements for the purchase of the property were made by her brothers. At that time, Madelaine had come back to live in the property to be cared for by her parents.

8

The £14,750 purchase price was raised by a mortgage obtained from Britannia Building Society. Repayment was guaranteed by Jim. The mortgage payments were met by Jonathan and Mildred (although there were some defaults). Jim and Bill nevertheless claim that they funded the mortgage by making equivalent payments to Jonathan and Mildred. That is contested.

9

Jim and Bill claim that when the property was bought, it was agreed that they would pay the mortgage (and possibly some other related expenses), so that Jonathan and Mildred would live in the property "rent free". They claim that there was an agreement or an understanding that on their deaths the property would vest in Jim and Bill. They therefore claim entitlement to the whole of the proceeds of the sale of the property following Jonathan's death under a constructive trust, as opposed to the two one-third shares that were offered to them.

10

Early in the negotiations for a loan, Britannia Building Society on 28 November 1986 sent to Jim as the proposed guarantor a form requiring the usual details that would be required of a borrower. The proposed monthly payments over a 25-year period would be £122.07. The covering letter included the following:

"I understand you are to be repaying the mortgage by Direct Debit or Standing Order and these forms are enclosed for your completion."

Jim did not in fact pay by direct debit or standing order but left it to his father to make the payments while he says he reimbursed his father for his half by various means and Bill reimbursed his father in cash. When it was put to him in cross-examination that it would have been much simpler to have done what was apparently at first agreed with Britannia Building Society and then get reimbursement as to half from his brother, Jim agreed that it would have been much better to have done it that way but could not or would not give any explanation why the simpler way was not adopted. If the simpler way had been adopted, penalties for late payment would have been avoided and Jim would have had clear proof that he had paid the mortgage instalments. As it is, the evidence that he or his brother paid any of the mortgage payments is woefully deficient. I shall have to return to that later.

11

Mildred died in 1995, and Jonathan continued to live in the property until November 1996. Because of illness, it was then agreed that he would live for three months with each of his children in rotation. He moved to live first with Bill and then Jim before going to live with Madelaine until his death in October 1998. Between November 1996 and October 1998, the property was rented out, and the mortgage and housing costs were met from the rent.

12

When he went to live with his sons, it became apparent that Jonathan's financial affairs were in a mess and Jim and his wife went to great efforts to sort them out with great success. Unfortunately, the way that it was done gave Jonathan the impression that he had lost control of his affairs. There was in particular a dispute about a sum of £3,300 removed from his Abbey National account by Jim which Jonathan called misappropriation.

13

When it came to his turn to go to live with Madelaine, she was living with Mr Yorke. They reorganised his affairs so that Jonathan felt that he had control of them under their guidance. That caused resentment on the part of the brothers and there was at least one unseemly row between Mr Yorke and Bill. However, Jonathan liked the new arrangement and decided to stay with Madelaine which caused further resentment. To look after her father, Madelaine gave up work (for which she had now become fit again) and it could be said (and indeed Mr Yorke has said) that her contribution to the family finances was in the form of her loss of earnings. Quite apart from finance, it is agreed by all the family that Jonathan had a soft spot for his daughter and it is clear that her love and affection and full time care were important to an old man in his dying months. During this period, Jonathan gave his daughter money for a holiday, which the brothers considered imprudent, and that was a further source of resentment.

14

Jonathan died on 3 October 1998 at the age of 82 of prostate cancer with widespread secondary cancers. The death certificate states that the informant of the death was Madelaine who was present at the death.

15

Jonathan was not very good with money and the purchase of the property was the biggest transaction he had ever conducted. But there is no suggestion that at any stage he was unable due to senility or illness to understand what he was doing or to conduct his affairs with proper advice.

16

Mildred never made a will. On her death intestate no one claimed any title to her share of the property other than Jonathan who continued to live in the property.

17

There are two wills of Jonathan put in evidence before me.

18

On 8 August 1997, Jonathan made what is accepted to have been his first will. That will is short and is typed on one sheet of A4 but nonetheless was plainly drawn by a solicitor. Jonathan must have had in mind the disposal of the property.

19

By that will, Jonathan first appointed his two sons together with his daughter as executors. Jim says that he did not know about that appointment or the terms of the will, which I find hard to believe. The will then gave legacies of £500 each to eight...

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