National Westminster Bank Plc v Luke Lucas and Others
| Jurisdiction | England & Wales |
| Judge | The Honourable Mr Justice Sales,Mr Justice Sales |
| Judgment Date | 11 March 2014 |
| Neutral Citation | [2014] EWHC 653 (Ch) |
| Docket Number | Case No: HC13F00335 |
| Court | Chancery Division |
| Date | 11 March 2014 |
In the Matter of the Administration of the Estate of Jimmy Savile
[2014] EWHC 653 (Ch)
The Honourable Mr Justice Sales
Case No: HC13F00335
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Mark Cunningham QC (instructed by Osborne Clark) for the Claimant (National Westminster Bank plc)
Teresa Rosen Peacocke (instructed by PWT Advice LLP) for the Trustees
Piers Feltham, Justin Levinson&Elizabeth GumbelQC (instructed by Slater & Gordon (UK) LLP) for the 3 rd & 4 th Defendants
Andrew Cosedge (instructed by PWT Advice LLP) for the 5 th Defendant
Neil Block QC (instructed by Capsticks LLP) for the 6 th Defendant
Andrew Warnock QC & Andrew Spencer (instructed by DAC Beachcroft LLP) for the 7 th Defendant
Approved Judgment
Hearing dates: 24/2/14–26/2/14
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Introduction
These proceedings relate to the administration of the estate of Jimmy Savile, the television presenter. Jimmy Savile died on 29 October 2011. The current value of his estate, after allowing for a range of expenses that have been incurred, is about £3.3 million.
Jimmy Savile left a will. The executor of the will and Jimmy Savile's personal representative is National Westminster Bank plc ("the Bank").
Various individuals are named in the will as beneficiaries ("the individual beneficiaries"). These include Mrs McKenna, who is Jimmy Savile's niece and next-of-kin. Mrs McKenna has now been appointed to represent the interests of the individual beneficiaries in these proceedings. Under the will, the residue of Jimmy Savile's estate is left to the Jimmy Savile Charitable Trust ("the Trust").
On 4 October 2012 a television programme was broadcast on ITV accusing Jimmy Savile of being a serial child abuser and sex offender. As a result of that programme and the publicity and further investigations into Jimmy Savile's activities which followed, a large number of people have come forward to make claims that they were abused by Jimmy Savile.
By the date of the hearing, 139 people had intimated to the Bank that they had personal injury claims against Jimmy Savile and his estate in relation to such abuse ("the PI Claimants"). Some of the PI Claimants have also indicated that they have claims against other defendants with whom Jimmy Savile was associated: the BBC, certain NHS hospital trusts and the charities Barnardo's and Mind (I refer to these as "the Third Party Defendants"). The great majority of the PI Claimants are now represented by Slater & Gordon solicitors (having previously been represented by the firms of Russell, Jones and Walker and Pannone).
The claims which the PI Claimants have brought forward have not been the subject of determination in court proceedings, and in that sense remain untested allegations. But there is no serious dispute that some, perhaps many, of the claims may be well-founded and meritorious. If such claims are substantiated, there is a serious possibility, to put it no higher, that they would exhaust the money remaining in the estate, leaving the individual beneficiaries and the Trust with nothing.
On the other hand, it cannot at this stage be assumed that this outcome will arise. The individual beneficiaries and the Trust have an interest to ensure that the claims are properly scrutinised. They maintain that if that happens a substantial part of the estate may remain available for distribution to them under the will.
There are two application notices before the court on this hearing. The first is an application notice dated 5 November 2013 issued by the trustees of the Trust seeking an order under section 50 of the Administration of Justice Act 1985 that an alternative professional executor (PennTrust Limited – "PennTrust") be appointed as personal representative of Jimmy Savile in place of the Bank, "on the grounds (inter alia) that the Bank's failure to act in the interests or for the benefit of the beneficiaries [i.e. including the Trust], the breakdown of the Bank's relationship with [the Trust] … based on the mode in which the estate is being administered and caused by substantial overcharges claimed against the estate, prevents the trusts of the estate being properly and expeditiously executed." The individual beneficiaries support this application. The Bank, the PI Claimants and Third Party Defendants oppose it.
The second is an application notice dated 17 December 2013 issued by the Bank seeking (i) a determination whether a proposed draft scheme designed to facilitate the speedy and inexpensive resolution of personal injury claims by the PI Claimants and others against Jimmy Savile's estate ("the Scheme") is a suitable mechanism by which the personal injury claims that have been and may in future be made against the estate can be dealt with and (ii) ratification by the court under section 284(1) of the Insolvency Act 1986 of various expenses incurred by the Bank in the course of executing the will and administering the estate, including substantial legal expenses which have been incurred. The request for approval of the Scheme is supported by the PI Claimants and the Third Party Defendants. The Bank's applications are opposed by the Trust and the individual beneficiaries.
At the end of the hearing, I was invited to indicate what my decision would be. I was persuaded that it was appropriate to do so, with detailed reasons in writing to follow. I indicated that I would dismiss the Trust's application to remove the Bank as executor and personal representative; I would approve the Scheme; and I would grant validation of expenses as sought by the Bank. This judgment sets out my reasons.
Factual Background
On 9 December 2011, at an early stage after the death of Jimmy Savile, the Bank issued an advertisement in the usual way under section 27 of the Trustee Act 1925 in a local newspaper and the London Gazette calling for claims in relation to Jimmy Savile and the estate to be notified to it by 13 March 2012.
The usual effect of such an advertisement is to provide protection for an executor who distributes an estate after paying out valid claims made by creditors (and notified pursuant to the advertisement) against the estate. However, it is common ground that advertisement pursuant to section 27 does not have this effect where, after the time for notifying claims as stated in the advertisement has passed but before the estate has been distributed and paid out, other claims are notified to the executor which require assessment.
That is what happened in this case. After the television programme in October 2012 and before distribution and winding up of the estate, it became clear that it was likely that various personal injury claims would be brought forward against Jimmy Savile's estate, as has happened.
Clearly, the interests of the PI Claimants, on the one hand, and of the Trust and the individual beneficiaries, on the other, are opposed. Both sides have potential claims to the money in the estate, depending on the contingency of how many of the personal injury claims may be found to be substantiated and for what quantum of damages.
At the same time, the interests of the PI Claimants (and of any other individuals who may in future bring personal injury claims against the estate – "future claimants") amongst themselves are potentially in conflict, in that the more claims which are found to be substantiated and the greater the amounts found to be due, the greater the risk that the remaining funds in the estate will be exhausted and the recovery in respect of the claims which are substantiated will have to be reduced pro rata. Hence, it is in the interest of those of the PI Claimants and any future claimants who have meritorious claims that those without meritorious claims or who may be making false claims should be screened out in some way, so as not to deplete the remaining funds in the estate and thus reduce the prospect that meritorious claims be met in full or at any rate with the least possible reduction.
A further complication is that, as mentioned above, some of the PI Claimants (and, it may be, future claimants) also have claims against the Third Party Defendants, who are various institutions which are alleged to be vicariously liable for tortious acts of Jimmy Savile, including certain NHS hospital trusts (represented in negotiations and before me by the Secretary of State for Health), the BBC and the charities Barnardo's and Mind. To the extent that such claims are substantiated, the Third Party Defendants will have claims over against Jimmy Savile's estate for an indemnity.
Another significant part of the context which has to be taken into account is the impact of legal and other costs which may be incurred by the estate and by others in seeking to resolve disputes regarding the merits of the multitude of claims which have already been brought forward and others which may in future be brought forward. The costs of dispute resolution validly incurred by the Bank in the course of administering the estate will be deducted from the fund available to meet claims of the PI Claimants, future claimants, the Third Party Defendants, the Trust and the individual beneficiaries. Parties involved in arguments to determine those claims will incur costs of their own which may in part also be recoverable from the estate and may in part have to be borne by themselves.
Accordingly, those with...
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