Nigel Fox v Marcus Nathan Bent

Hearing dates: 24 th and 25 th June 2024

Remote hand-down: This judgment was handed down remotely at 10.30am on Tuesday, 20 ^th August 2024 by circulation to the parties and their representatives by email and by release to the National Archives.

Introduction

This is my reserved judgment on an appeal against an order of Insolvency and Companies Court Judge Jones ( “the Judge”) made on 13 ^th July 2023 (amended under the slip rule on 19 ^th July 2023).

By this order ( “the Order”) the Judge declared that a property in Surrey ( “the Property”) was held by the First Respondent, Marcus Bent, on trust for his daughter, Aliyah Bent, who is the Fourth Respondent. Mr Bent was made bankrupt on 2 ^nd January 2019. The Appellants are his trustees in bankruptcy. The consequence of the Order is that the Property does not form part of Mr Bent's estate in bankruptcy, with the further consequence that the Appellants' claim for possession of the Property and an order for its sale for the benefit of the bankrupt estate fell to be dismissed.

The Judge made the Order pursuant to his judgment, on the Appellants' claim, dated 23 ^rd June 2023. For the reasons set out in this judgment ( “the Judgment”) the Judge decided that Mr Bent, who purchased the Property in 2006, held the Property on constructive trust for his daughter.

The Judge refused permission to appeal. By an order made on 19 ^th February 2024 Adam Johnson J granted the Appellants permission to appeal on two of their three grounds of appeal, but refused permission to appeal on the remaining ground of appeal. So far as the remaining ground of appeal is concerned, the Appellants applied to renew their application for permission to appeal at an oral hearing. In response to this application the court directed that the renewed application should be heard at the same time as the two grounds of appeal for which permission had been granted.

On the basis of their grounds of appeal, including the ground of appeal for which permission to appeal has not yet been granted, the Appellants say that the Order should be set aside and an order made for possession and sale of the Property for the benefit of the bankrupt estate. At the hearing of the appeal the Appellants also sought to add a further ground of appeal, by way of amendment of their grounds of appeal

On the hearing of the appeal, including the renewed application for permission to appeal and the application to add an additional ground of appeal, the Appellants have been represented by Michael Horton KC and Greg Williams, counsel. The First and Second Respondents appeared in person. The Fourth Respondent did not appear. With my permission, and in the absence of objection from the Appellants, I received the submissions of the First and Second Respondents as submissions in their behalf and on behalf of the Fourth Respondent.

The First and Second Respondents each confined their submissions to relatively brief statements. Given their unrepresented status, and it will be understood that this is in no way a criticism, the assistance that the First and Second Respondents were able to give me with the issues which I have to decide was necessarily limited. Both Respondents spoke with dignity and clarity. On the Appellants' side I am grateful to Mr Horton and Mr Williams for the clear and helpful assistance which they provided by their written and oral submissions. In particular, and in the light of the fact that the Respondents were unrepresented, I should record that the Appellants' counsel took pains to be fair to both sides in their submissions, drawing my attention to points which might be put against the Appellants' case and dealing fairly with those points. In accordance with the practice which is encouraged in the Business and Property Courts, which I commend, Mr Horton and Mr Williams shared the oral advocacy. Mr Williams dealt with the oral submissions in support of one of the grounds of appeal.

The parties

The Appellants, as I have said, are the trustees in bankruptcy of Marcus Bent.

Marcus Bent is a former professional footballer. His professional career ran from 1995 to 2012. He was made bankrupt on 2 ^nd January 2019, on the petition of HMRC. His debts are said to have been substantial, and are said to have amounted to a figure in excess of £2.2 million, as at 31 ^st December 2021. The only significant asset which was understood to form part of Mr Bent's bankrupt estate ( “the Estate”) was the Property. Whether this understanding was correct is, of course, the issue in these proceedings.

The Second Respondent, Ms Kelly Clark, is the former partner of Mr Bent and the mother of Aliyah Bent. Ms Clark and Mr Bent were in a relationship from 1995 until 2006. Ms Clark lives in the Property with her daughter and her younger child from a subsequent relationship.

Aliyah Bent, the Fourth Respondent, was born in 2004. Ms Bent was therefore a minor when the Property was purchased, and only attained her majority in the course of these proceedings.

The Third Respondents are described as persons unknown. My understanding is that this simply reflects the fact that it was unclear to the Appellants, when the proceedings were commenced, whether there were other persons living in the Property together with Ms Clark and Ms Bent. As matters have turned out, there are no additional occupants apart from Ms Clark's younger child.

It is convenient to continue to refer to Mr Bent's trustees in bankruptcy as the Appellants. For ease of reference I will refer to the First, Second and Fourth Respondents as, respectively, Mr Bent, Ms Clark and Ms Bent. The Appellants will understand that I intend no discourtesy to them in not using their names. The collective title simply reflects their capacity as trustees in bankruptcy of Mr Bent.

Given that there are no Third Respondents, my references to “the Respondents” in this judgment mean the First, Second and Fourth Respondents.

The conventions of this judgment

All references to Paragraphs in this judgment are, unless otherwise indicated, references to the paragraphs of the Judgment. Italics have been added to quotations.

I will refer to the appeal on the two grounds for which permission to appeal has been granted as “the Appeal”. I will refer to the renewed application for permission to appeal on the remaining ground of appeal as “the Permission Application”. I will refer to the application to amend the grounds of appeal by adding a new ground of appeal as “the Amendment Application”.

Summary of the background

I can summarise the background to the Appeal, and to the Permission Application and the Amendment Application very briefly.

Title to the Property is registered. The registered proprietor of the Property, specifically the freehold interest in the Property, is Mr Bent and has been since 2006. Mr Bent completed the purchase of the Property on 30 ^th June 2006, and was registered as proprietor of the Property on 29 ^th August 2006. The price paid for the Property on 30 ^th June 2006 is recorded on the registered title as £275,000.

The Property was purchased with the assistance of a mortgage. The cash contribution to the purchase price was paid by Mr Bent alone. Mr Bent paid the mortgage repayments until the mortgage was redeemed in 2013.

The Property was purchased at the time when Mr Bent and Ms Clark were separating, following the break-up of their relationship. Their child, Ms Bent, was two years old. The Property was occupied by Ms Clark and Ms Bent. Mr Bent himself did not occupy the Property.

The Judge found that Mr Bent and Ms Clark agreed that the Property was to be purchased in order to ensure that Ms Bent would have a home. They agreed that Mr Bent would purchase the Property and hold it upon bare trust for Ms Bent. I will come back to the findings made by the Judge in this context in more detail in the next section of this judgment. For present purposes, it is sufficient to say that the Judge decided, on the evidence, that Mr Bent purchased the Property on constructive trust for his daughter.

Subsequently Mr Bent was made bankrupt and the then trustees of bankruptcy of Mr Bent (there have been changes of trustee) commenced the current proceedings seeking possession and an order for sale of the Property.

The proceedings came to trial before the Judge on 19 ^th June 2023, which was a pre-reading day. The trial ( “the Trial”) commenced in court on 20 ^th June 2023, when the evidence was heard. Closing submissions were made on 21 ^st June 2023. The Judgment was delivered on 23 ^rd June 2023. Although the Judgment was delivered in court rather than being handed down, it is apparent, from the length and detail of the Judgment, that it was the subject of careful preparation. Pursuant to a previous case management order, and given the absence of any personal knowledge of what had occurred prior to their appointment, the two trustees in bankruptcy who had made witness statements in support of the Appellants' case were not required to attend the...