Roberts v Gill & Company and Another
| Jurisdiction | England & Wales |
| Judge | LORD COLLINS,LORD HOPE,LORD RODGER,LORD WALKER,LORD CLARKE |
| Judgment Date | 19 May 2010 |
| Neutral Citation | [2010] UKSC 22 |
| Date | 19 May 2010 |
| Court | Supreme Court |
and others
[2010] UKSC 22
Lord Hope, Deputy President
Lord Rodger
Lord Walker
Lord Collins
Lord Clarke
Appellant
Leslie Blohm QC
Guy Adams
(Instructed by Chilcotts)
Respondent
Tom Dumont
(Instructed by Barlow Lyde & Gilbert LLP)
Introduction
This appeal concerns a claim by a beneficiary under a will for negligence against solicitors who, he claims, allowed his brother, also a beneficiary and then the administrator of the estate, to acquire and dispose of land which should have been part of the residuary estate. The claim was begun in a personal capacity, but it is now accepted that a claim that the solicitors owed a duty of care to beneficiaries would be difficult to sustain, and the claimant seeks to amend the proceedings to claim in a representative capacity on behalf of the estate. The events of which the claimant complains happened 13 or 14 years ago.
The principal questions on this appeal relate to whether this is an appropriate case for a representative (or derivative) claim, which was the focus of the judge's decision, and to the interpretation and application of section 35 of the Limitation Act 1980 and the rules of court which were enacted pursuant to it, first in the Rules of the Supreme Court, and now in the Civil Procedure Rules. The limitation issues were the main focus of the decision of the Court of Appeal. Section 35 was enacted following recommendations of the Law Reform Committee in 1977. It had two main objectives. The first was to enable a plaintiff to amend pleadings out of time so as to sue in another capacity, in particular to reverse the effect of such decisions as Ingall v Moran [1944] KB 160, which created a grave injustice where proceedings were instituted under the Law Reform (Miscellaneous Provisions) Act 1934 prior to letters of administration being taken out and the limitation period expired before proceedings were instituted in a representative capacity: the grant did not date back to the date of death, by then it was too late to issue fresh proceedings or to amend. The second objective was to enable parties to be added out of time, in cases where joinder of the new party was necessary if the plaintiff's claim was to succeed, for example where the plaintiff was an equitable assignee and had omitted to join the assignor prior to the expiry of the limitation period.
But section 35 has been described as being "without doubt one of the most convoluted provisions in the entire law of limitations" (McGee, Limitation Periods, 5 th ed 2006, para 23.003). That is no doubt why there have been more than 25 decisions of the Court of Appeal on section 35 and the rules of court.
The background
Mrs. Alice Margot Roberts ("Mrs Roberts"), of Lower Hellingtown in Devon, made a will on March 6, 1992. In September 1994 a receiver was appointed by the Court of Protection to administer her affairs. She died on July 27, 1995. Her grandson, Mark Roberts, the appellant, is one of the three equal residuary beneficiaries of the estate of Mrs Roberts. The other residuary beneficiaries are his brother, John Roberts, and his aunt, Ms Jill Roberts.
The executors named in the will (Mrs Roberts' solicitor and an accountant) renounced their right to probate and John Roberts was granted letters of administration with will annexed on February 16, 1996.
Mrs Roberts' will provided in clause 7 that if John Roberts within a specified time (the earlier of one month from demand by the trustees or twelve months from death) either paid, or provided security or an indemnity to the will trustees for, all of the estate and other duty arising on her death in respect of her estate then (i) a piece of land known as the Coppice would pass to Mark Roberts and (ii) the remainder of the property known as Lower Hellingtown Farm would pass to John Roberts. By clause 8, if the payment was not made or security/indemnity given then the properties would fall into residue. Consequently (because of the value of the farm) if John Roberts complied with the condition in clause 7 the position would be much more favourable to him than if he did not, and the converse was true in relation to Mark Roberts.
John Roberts paid some inheritance tax in order to obtain the grant of letters of administration. He does not appear to have paid the remaining inheritance tax due, which may amount to some £60,000 and with interest would substantially exceed £100,000.
During the time John Roberts acted as administrator, he instructed two firms of solicitors, Gill & Co and Whitehead Vizard, the first and second defendants.
In July 1996 John Roberts, as personal representative, executed an assent to Lower Hellingtown Farm vesting in himself as beneficiary. The first defendants, Gill & Co, acted for him on the grant of letters of administration, and (it seems) on the preparation of the assent.
In or about 1997, Lower Hellingtown Farm was sold by John Roberts in two lots for a total of £305,166.19. Some £285,000 of the proceeds of sale were paid to John Roberts and the balance was used to discharge certain estate liabilities. Whitehead Vizard, the second defendants, acted for John Roberts on the sale of Lower Hellingtown Farm.
By order dated October 30, 2000, on the application of Mark Roberts, John Roberts was replaced as administrator of the estate by Mr Charles Sainter, a partner in the firm of solicitors then and now acting for Mark Roberts.
By a claim form dated November 27, 2002, issued in the Plymouth County Court, Mark Roberts started proceedings against the solicitors for breach of duty of care owed to him as beneficiary of Mrs Roberts's estate. The particulars of claim alleged that: (1) the first firm, Gill & Co, were retained by John Roberts to advise him on matters arising from the appointment by the Court of Protection of a receiver for Mrs Roberts and, after her death, to obtain letters of administration and subsequently to assist and advise on the administration of her estate; (2) John Roberts instructed the second firm, Whitehead Vizard, from April 1997 to act on his behalf on the sale of Lower Hellingtown Farm; (3) inheritance tax payable by reason of the death of Mrs Roberts had never been paid and no security or indemnity for the same had been furnished by John Roberts; (4) inheritance tax on Mrs Roberts' personal estate was paid at the beginning of February 1996, together with the first of ten annual instalments payable in respect of her real estate, but no further inheritance tax was paid thereafter, and the duty payable in respect of Mrs Roberts' life interest under two will trusts had not been satisfied; (5) notwithstanding this, on July 23, 1996 a legal executive employed by Gill & Co prepared and witnessed the transfer of Lower Hellingtown Farm by John Roberts as trustee of the property to himself as beneficiary under the will; (6) in so doing, Gill & Co acted in breach of duty owed to Mark Roberts personally as beneficiary in the estate; (7) Whitehead Vizard were instructed by John Roberts to act on his behalf on the sale of the farm to a third party, which took place in 1997, and negligently and in breach of duty to Mark Roberts, Whitehead Vizard effected the sale of the farm when they knew, or ought to have known, that the inheritance tax had not been paid or secured and hence that John Roberts did not have good title to the farm; (8) by reason of the negligence and want of care of the two firms Mark Roberts suffered loss and damage in that but for their negligence the farm would have fallen into the residuary estate of which he is entitled to a one third share, and the remaining estate is insufficient to meet either the pecuniary legacies or to discharge the inheritance tax outstanding.
The foundation of the claim is that the estate had been administered on the false basis that the requirements of clause 7 of the will had been complied with so that clause 7 of the will operated and clause 8 of the will did not have the effect of putting the land referred to in clause 7 of the will into the residuary estate. There is no doubt that this was a claim by Mark Roberts personally for loss suffered by him as a beneficiary.
On January 30, 2003 an order was made staying the action to allow the pre-action protocol to be followed. On March 12, 2003 the solicitors for the defendants wrote to Mark Roberts' solicitors rejecting the claim, because (they said) the law does not recognise a duty of care between a solicitor instructed by a personal representative and a beneficiary. In April 2003, the parties agreed a general extension of time for the filing of a defence to enable Mark Roberts to respond to the letter from the defendants' solicitors. A defence has not been filed.
Any claim by the personal representative of Mrs Roberts became statute-barred at the latest during 2003, six years after the sale of the farm by John Roberts.
By an application notice dated August 25, 2006 Mark Roberts applied to amend the proceedings, three years after the expiry of the limitation period, in order to continue them both in his personal capacity and as a derivative action on behalf of the estate.
The proposed amendments (1) describe Mark Roberts as suing on his own behalf and as representing the estate of Mrs Roberts; and (2) plead that (a) Gill & Co acted in breach of the duty of care owed not only to Mark Roberts but also to the estate of Mrs Roberts; (b) Whitehead Vizard were instructed, not only to act for John Roberts on the sale of the farm, but also to assist in the administration of Mrs Roberts' estate; and (c) as a result of both firms' negligence, the estate has suffered loss and damage in that the farm would have fallen into the residuary estate.
The proceedings were...
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